EMIS Insights - Africa Telecommunications Sector Report 2021-2022

COVID-19 UPDATE
AFRICA
TELECOMMUNICATIONS
SECTOR 2021/2022
An EMIS Insights Industry Report
Any redistribution of this information is strictly prohibited.

Copyright © 2021 ISI Emerging Markets Group, all rights reserved.
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ABBREVIATIONS
ADSL Asymmetric Digital Subscriber Line
ANRT Morocco’s Telecommunications Regulatory Agency
ARPU Average Revenue Per User
CAGR Compound Annual Growth Rate
CAK Communications Authority of Kenya
COVID-19 Coronavirus Disease 2019
EIU The Economist Intelligence Unit
EGP Egyptian Pound
ICA Infrastructure Consortium for Africa
ICT Information and Communication Technology
ITU International Telecommunication Union
KES Kenyan Shilling
LTE Long-Term Evolution
MAD Moroccan Dirham
MCIT Egypt’s Ministry of Communications & Information Technology
NCC Nigerian Communications Commission
NGN Nigerian Naira
NTRA Egypt’s Telecommunication Regulatory Authority
PPP Public Private Partnership
TE Telecom Egypt
VOIP Voice Over Internet Protocol

CONTENTS FOREWORD
01 EXECUTIVE SUMMARY
Sector Overview
p.5
p.6
Mobile Telephony
Mobile Broadband
Fixed-Line Telephony
Fixed Broadband
Internet Access
National Broadband Policies
ICT Infrastructure Investments
02 REGIONAL OVERVIEW p.20

Regional Comparison
Northern Africa
Western Africa
Eastern Africa
Southern Africa
Central Africa
03 NIGERIA p.33
Sector Snapshot
Sector Outlook
Driving Forces
Restraining Forces
Market Opportunities
Competitive Landscape
M&A Deals
CONTENTS 04 EGYPT
Sector Snapshot
Sector Outlook
Driving Forces
p.44
Restraining Forces
M&A Deals
05 KENYA p.53
Sector Snapshot
Sector Outlook Not available with
Driving Forces
sample edition
Restraining Forces
M&A Deals
06 MOROCCO p.62
Sector Snapshot
Sector Outlook
Driving Forces
Restraining Forces
AFRICA TELECOMMUNICATIONS SECTOR 2021/2022
Foreword
The past ten years have been both transformational and
disruptive to the telecom companies’ business model. This
trend has been driven by gains in broadband penetration
and growing internet adoption. As the COVID-19 pandemic
began to spread, demand for traditional phone calls and
SMS had already been declining and was being radically
substituted and displaced by instant messaging and
Maagatha Kalavadakken,
Research Analyst, Africa
internet-enabled voice and video calls.
The African telecommunication sector has matured and has positively and significantly impacted the
growth of the economies on the continent in many ways. From enabling access to banking via mobile
phones to connecting the formal and informal economies that exist in the region. However, the
COVID-19 pandemic highlighted the need for a more robust and inclusive telecommunication sector in
the face of national lockdowns. COVID-19 has had a significant impact on the global economy as
whole. Many countries instigated a form of lockdowns, with the strictest level allowing only essential
services to operate while the rest are encouraged to work from home. Consequently, many business
including telcos have been disrupted amidst the economic slowdown. For African countries, while
both the public and private sector rose to the challenge by increasing the bandwidth as demanded by
the increased data traffic due to people working from home, existing challenges saw the majority
excluded.
The pandemic has put telcos under immense pressure to accommodate increased network traffic,
which required additional spending on critical infrastructure and digitalisation. This, coupled with
reduced consumer spending has exerted added cashflow pressure and depleted margins for telcos.
Looking forward, as the economies recover so will demand for mobile internet services, as the use of
WhatsApp, Facebook, and video call services will continue to dominate the market, providing telcos
with opportunity to grow revenues. The three main telecoms in Africa – MTN, Orange and Airtel – have
all revealed their strategies to expand their 3G and 4G coverage across the continent. This move is
expected to diversify and grow their revenues in future.

An EMIS Insights Industry Report CONTENTS
01
EXECUTIVE
SUMMARY

Copyright © 2021 ISI Emerging Markets Group, all rights reserved. 6
01 EXECUTIVE SUMMARY CONTENTS
Sector Overview
The year 2020 saw countries going into lockdown as a result of COVID-19. The telecom sector became
an anchor for economic activities to continue as learners, workers and all non-essential operations
needed to be conducted from home. Switching to online classes and working from home, however,
has been a real challenge for African countries, where are home to a third of the world’s population
without internet. Of the 3.2bn people who don’t have access to the internet, 871mn live in Africa,
according to a report by Visual Capitalist and DataReportal published in August 2020. For Africa, it is
important to take into account the various challenges the industry faces, such as access to electricity,
lack of well-developed digital infrastructure and regulations, as well as the ability of the population
to use digital solutions, where they are available.
According to the World Bank Report, African countries spend about 1.1% of their annual GDP on digital
investment, while that share for advanced economies averages 3.2%. In terms of internet usage Africa
is at the bottom of the global ranking with only 28.2% of its population using the internet, below the
world’s average of 53.6% and well below the 82.5% registered in Europe, the region with the highest
internet usage as of end-2019, according to data provided by the International Telecommunications
Union (ITU). Africans log into the web mainly via their mobile phones with the number of mobile
internet users at 335mn at end-2019. Yet, only 10% of these subscribers use 4G technology. In the
wake of COVID-19, meaningful participation in the digital economy requires high-speed broadband
connection to the internet. Research compiled by UK broadband comparison site Cable.co.uk found
that 32 of the 50 slowest-performing countries in terms of broadband download speed are located in
Africa. Northern Africa performed worse than Sub-Saharan Africa with Algeria (1.83Mbps) and Libya
(2.60Mbps) offering the slowest speeds, while the best performers are Madagascar (18.00Mbps),
Réunion (16.35Mbps) and South Africa (14.04Mbps).
While most African countries have made rapid advances in mobile phone and mobile internet
penetration, overall ICT infrastructure is still not fully developed. The leading economies – Kenya,
Nigeria and South Africa, which is piloting 5G connectivity – have developed next-generation mobile
and digital networks. However, smaller economies still rely on legacy network technologies such as 2G
connections. Infrastructure deployment in Sub-Saharan Africa increased 3G coverage from 63% in 2017
to 70% in 2018, extending access to more than 80mn people.
Source: Ericsson Mobility Report, GSMA Intelligence, UNECA, Africa Internet Insights
AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 7

Sector Overview (cont’d)
Africa’s telecommunication sector has been growing rapidly over recent years, driven mainly by the
mobile services segment. Mobile telephone subscriptions grew at a CAGR of 8.3% over the 2009–2019
period, the fastest in the world and above the global CAGR of 6%, according to ITU data. That helped
Africa claim a share of 11.9% of all mobile users worldwide in 2019, second only to the Asia Pacific
region, which accounted for a share of 57%. ITU estimates subscriptions in Africa, excluding the Arab
countries, grew by 5.5% y/y to 882mn in 2020. The growth was supported by the increased impact of
the mobile economy during the pandemic. Post-pandemic growth drivers will include an increase in
private consumption once the African economies recover, strong and growing developer and digital
talent, coupled with investments in digital infrastructure.
The number of active users, however, stands significantly below the number of subscriptions (at
335mn* as of end-2019), due to widespread multiple SIM card ownership. This practice is driven by the
still insufficient quality of mobile services, both in terms of coverage and customer rights. Moreover,
prepaid subscriptions still have the lion’s share across the continent. In terms of both users and
revenues, the mobile segment is currently driven mainly by mobile data and by the mobile money
service.
While 60% of Africa’s population accesses the internet via mobile, most mobile connections are
through 2G networks, the main reason being their affordability. A key barrier to smartphone adoption
in Africa is the affordability of 4G devices. Though the average selling price of smartphones has
reduced significantly in recent years, especially with the influx of Chinese brands with prices below
USD 100, many Africans are still unable to afford the one-off upfront cost of purchasing a device. Still,
there has been an increasing demand for high-speed internet, and the mobile communications
industry body, GSMA Intelligence forecasts Sub-Saharan Africa’s 3G and 4G broadband connections
account for 54% and 31%, respectively, of all connections by 2025. At end-2019, 3G connections made
up 46% of total, closely followed by 3G at 45% and 4% at only 10%. The share of 5G connections is
seen reaching a mere 3% in 2025.
*Data for Africa excluding Arab countries
Source: IFC, ITU, World Bank, Africa & Bandwidth Maps

In line with global trends, fixed telephony on the continent has been on a downward trend over the
past decade, with the number of subscriptions falling at a CAGR of 2.7% over the 2009–2019 period,
versus a decline of 3.0% CAGR for the world. In 2019 however, subscriptions rose by 4.8% y/y to
24.3mn, making up just 2.7% of the global total.
Though internet access has improved significantly in Africa in recent years, the continent lags far
behind global development. ITU data shows that 299mn Africans were using the internet at the end of
2019, that was nearly five times more than 2009, but it accounted for just 8% of the world’s total
users in 2019. The strong penetration of mobile services has contributed significantly to improved
internet access. The number of active mobile broadband users in Africa expanded at a CAGR of 45.1%
over 2009–2019, nearly double the 25% pace at which global subscriptions grew over the same period.
Active mobile broadband users on the continent reached 450.6% at end-2019, taking a global share of
7.9%. Fixed broadband usage also grew but at the much slower pace of CAGR 17.7% over 2009–2019 to
reach 19.3mn at the end of that period. Fixed broadband usage remains restricted by its high cost and
digital illiteracy. Furthermore, PC ownership is limited, with only 19% of the households having a
computer at home.
As part of efforts to support investments in telecom infrastructure by the end of 2019, 50 of the 54
African countries had adopted a national broadband strategy. A significant milestone was also
achieved in February 2020 when the Digital Transformation Strategy for Africa was adopted by the
African Union Commission. Under these strategies, investments are directed towards terrestrial
backbone fibre and undersea fibre-optic cable projects, among other things. In 2020, 25 backbone
fibre projects were announced. Among these, the ‘One Africa’ fibre-optic network project stands out,
as it is planned to connect Cape Town in South Africa with Cairo in Egypt. Undersea fibre-optic cable
projects also saw development, the most notable being the launch of the South Atlantic Cable System,
which provides a direct connection between Africa and South America (Angola and Brazil), offering
alternative lower-latency routes to the Americas.
More pivotal for the growth of the telecommunications sector is the growing digital economy in
Africa. The digital market has attracted more venture capital and has championed growth in many
sectors, including maturing ones such as the mobile money market in Kenya. The digital economy has
also bred new talent within the continent’s youthful population. There are now over 618 tech
development hubs across in Africa.
Source: Ericsson Mobility Report, GSMA Intelligence, UNECA, Africa Internet Insights

The internet economy is also offering leapfrog opportunities to address challenges faced by informal
businesses and workers. Informal businesses represent 92% of firms in Nigeria and 99% in Ethiopia.
Businesses in Africa’s informal sector have less access to finance and limited use of modern business
practices, especially in accounting. They also face higher costs in dealing with suppliers or clients due
to poor logistics, multiplicity of middlemen, and the prevalence of cash transactions. In the informal
sector, access to electricity is less certain, especially in rural areas, and the overall business
environment is unstable. However, the vast majority of workers in the informal sector own a mobile
phone, often used for both private and business purposes. Mobile phone ownership in the informal
sector broadly correlates with access to digital connectivity at the national level. There are 1.2mn
informal retailers in Sub-Saharan Africa already engaged in the distribution of mobile services.
COVID-19 has highlighted how digital platforms addressing the informal sector can support societal
resilience. In several markets, digital platforms were critical in supporting government responses to
the outbreak, particularly in reaching the under-served, as they were able to quickly re-engineer their
platforms. For instance, Twiga Foods has partnered with Jumia to deliver agricultural produce to
consumers. The government of Nigeria is relying on payment service providers to provide cash
transfers to 3.6mn impoverished households. Digitalisation has provided additional tools to respond
to the COVID-19 pandemic. Digital platforms have enabled the rapid deployment of social protection
programmes and enabled some essential government services to continue to operate.
In 2019 the number of registered mobile money accounts in Sub-Saharan Africa increased by 12% y/y
to reach 469mn, of which active accounts made up 181mn, according to data provided by GSMA
Intelligence in its State of the Industry Report on Mobile Money 2019. A total of 23.8bn digital
transactions were made in the region in 2019 and their value stood at USD 456.3bn, up 27.5% y/y. For
the region of the Middle East and North Africa the figures show that there were 51mn registered
mobile money accounts (91mn active) in 2019, when 663mn digital transactions were made at the
value of USD 9.1bn, up 37.4% y/y.
Source: ITU, GSMA Intelligence,

Nigeria is Africa’s largest mobile market, accounting for 19% of the continent’s subscriptions in 2019.
Globally, the country ranked eighth with a share of 2.2%, according to data provided by ITU. The
country is also well positioned for future growth as it still has low penetration rates. Broadband is
largely underdeveloped, fixed broadband penetration standing at 0.07% in 2019 and mobile broadband
at 36%. Moreover, data continues to be affordable; Alliance for Affordable Internet figures show that
the country’s lowest-price prepaid broadband plan for mobile handsets costs 1.7% of the average
monthly income in 2019. The equivalent figure for 2015 was 6.5%. Furthermore, in 2019 the country’s
leading mobile company MTN launched its own 3G feature phone costing USD 20.
Egypt’s mobile market is the second largest on the continent with 95.3mn subscriptions in 2019. The
mobile market is more mature than the Nigerian one having a penetration rate of 95%. The fixed
segment, both telephony and broadband, is the largest in Africa with respective number of
subscriptions at 8.8mn (0.96% global share) and 7.6mn (0.67% global share) in 2019. Thus, telecoms’
efforts continue to be more directed towards the mobile data service, as it still represents only a third
of the mobile subscriptions. Egypt benefits from its geography, which allows it to connect to
numerous cables interconnecting various parts of Europe with the Middle East and Asia.
Kenya is also home to one of the largest mobile markets on the continent, providing services to 5.5%
of Africa’s mobile phone users. According to GSMA Intelligence, 52% of the population has access to a
mobile network, unique subscribers grew steadily from 29.9% in 2009 to 51.5% in 2019 with a
penetration rate of 97.3%. The market is also growing robustly in terms of mobile broadband. In 2019,
there were 25.8% unique mobile broadband subscribers, up from 10% in 2010. Although the mobile
market is still dominated by 2G users (50.6% of all connections), 3G is growing steadily at 38% while
4G is in its infancy at 8.7%. Despite being at a low level, broadband is a segment with good prospects,
due to the government commitment to develop the information and communication technology (ICT)
sector. Fixed broadband subscriptions grew by 28.9% y/y to 371,500 in 2019.
Morocco’s ICT sector is one of the most advanced in Africa with 60% of the country area covered by
LTE mobile technology. As of 2019, the country’s mobile penetration was 125% with moderately
growing mobile subscribers reaching 46.7m. Growth is also driven by the increased use of
smartphones, which make up 80% of all mobile phones used in Morocco. By number of fixed
broadband subscriptions, Morocco ranked third in Africa in 2019 after Egypt and Algeria.
Source: Ovum, Research ICT Africa, World Bank, Ericsson Mobility Report, UNECA

Mobile Telephony
Mobile Cellular Subscriptions, mn, 2019
World: 8,283mn
5. Russia
239.8
3. US 7. Japan
442.5 1. China 186.5
1,746
2. India 9. The Philippines

1,151 165.4
Morocco 4. Indonesia
6. Brazil 46.7 341.3
202 10. Bangladesh
165.6
Algeria
Egypt
47.1
95.3
Brazil Sudan
12.8 33
8.Nigeria
184.6
Kenya
Ivory DR Congo 54.6
992.2mn Coast
37.1
37.4 Tanzania
Africa 47.7
Ghana
8.3% 40.9
CAGR 2009–2019
12%
% of global South
Africa
97
Source: ITU, CEIC, World Bank

Mobile Broadband
Active Mobile-Broadband Subscriptions, mn, 2020*
CIS
213mn
3.7% share of
Europe global
689mn
12.1% share of
global
Arab States
261mn
4.5% share of
global
The Americas Asia & Pacific
1010mn 3,296mn
17.3% share of
global
354mn 56.6% share of
global
Sub-Saharan Africa
6.1%
% of global World:
5,826mn
*Estimates
Mobile Money Registered Accounts, mn, end-2019
Europe &
Central Asia
Middle East & 20mn
1.9% share of
North Africa
global
51mn
4.9% share of
South Asia
global
315mn
30.3% share of
Latin America & global
Caribbean East Asia & Pacific
26mn 469mn 158mn
2.5% share of Sub-Saharan Africa 15.2% share of global
global
45.1%
% of global World:
1.04bn
Source: ITU, GSMA Intelligence

Fixed-Line Telephony
Africa in Global Fixed-Line Telephony*, 2019
1. China
191
20.9%
2. United States
107.6 11.8%
19. Egypt
8.8
0.96%
4.6 31. Algeria

0.5%
53. Morocco
0.23% 2.1
2.0 54. South Africa

0.22%
59. Libya
0.2% 1.6
1.5 62. Tunisia

0.16%
72. Cameroon
0.1% 0.5
0.5 86. Mauritius

0.05%
98. Ghana 0.3
0.03%
Africa Fixed-Line Subscriptions 24.3mn
Africa Fixed-Line Subscriptions, % of global 2.7%
Africa Fixed-Line Subscriptions, 2009–2019 -2.7% CAGR
*191mn fixed-line telephony subscribers; 20.9% – share of global

Note: The ranking includes countries for which there was data for 2019
Source: ITU, World Bank

Fixed Broadband
Africa in Global Fixed Broadband,* 2019
1. China
449.3
39.6%
2. United States
114.3 10.1%
24. Egypt
0.67% 7.6
40. Algeria
3.6 0.32%
58. Morocco
0.16% 1.8
65. South Africa
1.3 0.11%
66. Tunisia
0.11% 1.2
68. Tanzania
1.04 0.09%
81. Kenya 0.5
0.04%
0.4 88. Cameroon

0.04%
95. Libya
0.02% 0.3
Africa Fixed-Line Broadband Subscriptions 19.3mn
Africa Fixed-Line Broadband Subscriptions, % of global 1.7%
Africa Fixed-Line Broadband Subscriptions, 2009–2019 17.7% CAGR
*449.3mn fixed-line broadband subscribers; 39.6% – share of global

Note: The ranking includes countries for which there was data for 2019
Source: ITU, World Bank, CEIC

Internet Access
PC Ownership and Internet Access at Home, 2019*
Europe
Households with a
CIS
Computer: 82%: 66%
Households with a The Americas
Households with Internet Computer: 72%; 50% Households with a
Access at Home: 88%; 78% Households with Internet Computer: 67%; 34%
Access at Home: 81%; 66% Households with Internet
Access at Home: 74%; 50%
Arab States
Households with a Asia & Pacific
Computer: 67%; 34% Households with a
Households with Internet Computer: 60%; 22%
Access at Home: 74%; 38% Households with Internet
Access at Home: 70%;
36%
Africa
Households with a
Computer: 17%; 2%
Households with
Internet Access at
Home: 28%; 6%
Urban areas
Rural areas
*Estimates
Source: ITU

Policy Year of Policy

Region Country Title/Details
Available? Adoption
E-Algérie 2013; Action Plan/Roadmap 2015–2019;
Algeria Yes 2008
Broadband & High-speed Broadband strategy
Egypt Yes 2014 eMisr National Broadband Plan
Libya No - -
Northern Africa
Sudan Yes 2012 Sudan’s National Strategic Development Plan 2012–2016
Plan national pour le développement du haut et très haut débit au Maroc;
Morocco Yes 2012
Stratégie Maroc Numérique 2020,
Tunisia Yes 2015 Tunisie Digitale 2018
Projet de Développement des Infrastructures et des TIC ; Plan TIC Benin,
Benin Yes 2016
eNNOV Benin 2021
National Plan for Economic and Social Development (PNDES) 2016–2020;
Burkina Faso Yes 2016 Plan d’actions de la politique sectorielle de l’économie numérique et des postes
(2017–2019); Projet Backbone national des télécommunications
Cabo Verde Yes 2016 Estratégia Nacional para a Banda Larga 2016
Ivory Coast Yes 2016 Le Réseau National Haut Débit (RNHD) 2016
Gambia Yes 2008 The Gambian ICT4D-2012 Plan
Ghana Yes 2010 National Strategy for Digital Growth; Broadband Wireless Access 2010
Plan National de développement economique et social de la République de
Guinea Yes 2016 Guinée 2016–2020; politique et stratégie de développement des TIC de la
République de Guinée
Western Africa Guinea-Bissau No - -
Policy for the Telecommunications and Information Communications
Liberia Yes 2010
Technology (ICT)
Mali Yes 2018 Plan Mali Numérique 2020; Strategie large bande (NB plan)
Mauritania Yes - Stratégie Nationale des Technologies de l’Information et de la Communication
Plan de développement des Technologies de l’Information et de la
Niger Yes 2005
Communication au Niger / Plan NICI du Niger
Nigeria Yes 2013 National Broadband Plan 2013–2018
Senegal Yes 2016 Sénégal Numérique 2016–2025
Sierra Leone Yes 2019 National ICT Policy National Broadband Strategy
Déclaration de politique du secteur de l’économie numérique pour la période
Togo Yes 2018
2018–2022; Schéma directeur de l’aménagement numérique du territoire
Botswana Yes 2014 Botswana’s National Broadband Strategy 2014
Eswatini yes - National Information and Communication Infrastructure (NICI) Policy
Lesotho Yes 2014 National Broadband Policy 2014–2018
Southern Africa Namibia Yes 2009 Telecommunications Policy for the Republic of Namibia
South Africa Yes 2013 National Broadband Policy
Zambia Yes 2006 National Information and Communication Technology Policy
Zimbabwe Yes 2005 National ICT Policy
Source: ITU: The State of Broadband 2018

Policy Year of Policy

Region Country Title/Details
Available? Adoption
Loi N°14-031/AU du 17 Mars 2014, "Décret N°08-019/PR" ; World Bank: " The Regional
Comoros Yes 2014
Communications Infrastructure Program Phase 4 (RCIP 4) : Comores"
Strategy of Accelerated Growth and Promotion of Employment (SCAPE) 2015–2019,
Djibouti Yes 2015 Strategies of the development of Telecommunications & Post Office 2011–2015", Vision
Djibouti 2035
Eritrea No - -
National ICT Policy and Strategy; National Broadband Master Plan- FDR Ethiopia ICT
Ethiopia Yes 2013
Policy (DRAFT) National Broadband Plan 2016
Madagascar Yes 2014 Le numérique pour tous ; "Projet sur le développement Numérique à Madagascar"
Malawi Yes 2013 National ICT Policy; National Wireless Broadband Plan
Eastern Mauritius Yes 2012 National Broadband Policy 2012–2020 (NBP2012)
Africa National ICT Policy Implementation Strategy 2002and 2006 – Digital Inclusion in
Mozambique Yes 2006
Mozambique
Kenya Yes 2017 National Broadband Strategy – Vision 2030; Connected Kenya 2017 Master Plan
Seychelles Yes 2010 National ICT Policy 2010
Somalia No - -
South Sudan No - -
Tanzania Yes 2004 National Information Communication and Technology Broadband Backbone (NICTBB)
Uganda Yes 2009 Uganda Broadband Infrastructure Strategy National Position Paper
Zambia Yes 2006 National Information and Communication Technology Policy
Zimbabwe Yes 2005 National ICT Policy
Main objectives of the Ministry of Telecommunications & IT for the five-year period (2017–
2022)’; White Book of Information and Communication Technologies, Livro branco das
Angola Yes 2013
Tecnologias da Informação e Comunicação – LBTIC, Information Society National Plan
2013–2017
Cameroon Yes 2016 Strategic Plan for a Digital Cameroon 2016–2020, "Digital Economy Strategy Plan"
Central African Politique, Stratégies et plan d’actions de l’édification de la Société de l’Information en
Yes 2006
Republic République Centrafricaine
Plan de développement des technologies de l’Information et de la Communication au
Chad Yes 2007
Tchad or PLAN NICI
Arrêté ministériel n° CAB/MIN/PTNTIC/TKKM/PKM/sap/022/012 du 21 décembre 2012
fixant les conditions et modalités d’établissement et d’exploitation du réseau des
DR Congo Yes 2018
Central télécommunications à fibre optique en République Démocratique du Congo ; DRC’s
Africa Telecommunications Act, May 2018
Projet de Couverture Nationale (PCN), Projet West Africa Cable System (WACS), Projet
Rep. of Congo Yes 2011
Central Africa Backbone – Composante République du Congo (CAB-CIT CG)
Nuevas Tecnologias: national project aimed at the popularization of technologies
Equatorial Guinea Yes 2012
Information and communication (TICGE) 2012–2020
Gabon Yes 2012 Plan sectoriel Gabon numérique
Regional Connectivity Infrastructure Program (RCIP); National Broadband Policy for
Rwanda Yes 2015
Rwanda; SMART Rwanda Master Plan 2015–2020
Sao Tome and

No - -
Principe
Source: ITU: The State of Broadband 2018

ICT Infrastructure Investments
ICT Sector Financing by Source
7,081
4,848
2,388
300 2,394
165 2,269
1
67 600 66
1,906
18
261 570
1,105 1,658
47 1,114
806 616 894 618
396 506 503
1,032 417 1,051
424 410 300 510
2013 2014 2015 2016 2017 2018
China ICA Members National Governments Other Bilaterals/Multilater als Pr ivate Sector Total
Comments
Africa’s ICT sector witnessed record financing commitments in 2018, the Infrastructure Consortium for
Africa (ICA) said in its latest report. They more than tripled from 2017 to reach USD 7.1bn in 2018 with
the private sector committing to invest the lion’s share of USD 4.8bn. The significant increase,
however, reflects a change in the reporting methodology, which includes self-standing private sector
financing for the first time. The second biggest source of investments are African governments that
contributed USD 1.1bn in 2018, up from USD 600mn in 2017. China and ICA members are also major
sources of financing. China’s financing includes USD 550mn in the ICT sector. At the country level, the
largest allocations were in Kenya (USD 160mn) and Egypt (USD 116mn).
ICA estimates Africa’s ICT financial needs to be in the range of USD 4bn–7bn a year for the continent
to attain universal mobile coverage with at least 50% of the population lives within 25km of a fibre
backbone and the fibre-to-home internet penetration rate reaches 10%.
Source: ICA

02
REGIONAL
OVERVIEW

02 REGIONAL OVERVIEW CONTENTS
Regional Comparison
Mobile Telephony Subscriptions, Fixed Telephone Subscriptions, mn, 2019

mn, 2019
Eastern Africa; 203.2;

20.5% Northern Africa;
18.6;
76.5% Southern
Northern Africa;
Africa; 2.3;
242.9; 9.5%
24.5%
Southern Africa;
105.1; 10.6% Western
Africa; 1.2;
4.9%
Eastern
Africa; 1.2;
Central Africa; 4.9%
94.2; 9.5%
Central Africa;
1.0; 4.1%
Western Africa;
346.8;
35.0%
Fixed Broadband Subscriptions, thou, 2019 ICT Funding by Region, USD mn, 2015–2018
Northern Africa;
Eastern Africa; 2.3; Central
11.9% Africa 1
14.5; Western
75.1% Africa 2 480
649
Northern
Africa 1
Southern 538
Africa; 1.3;
6.7%
Western Eastern
Africa; 0.6; Africa 1
3.1% 202
Central Southern
Africa; 0.6;
3.1% Africa (inc
RSA) 6 226
Source: World Bank, ITU, CEIC, ICA

Northern Africa
Users by Country
Libya
Tunisia
Mobile Phone Users:
6,020,000
Mobile Phone Users: 14,771,048
Fixed-Line Telephone Users: Fixed-Line Telephone
1,454,183 Users: 1,576,000
Algeria
Mobile Phone Users:
47,081,131
Fixed-Line Telephone
Users: 4,635,217
Egypt
Mobile Phone Users:

95,340,262
Users: 8,760,436
Morocco
Mobile Phone Users:
46,666,722
Fixed-Line Telephone Sudan
Users: 2,054,545
Fixed-Line Telephone Users: 137,842
Comments
Northern Africa is the most advanced region in Africa in terms of ICT development. The region ranks
as Africa’s top market by number of fixed-line telephony and broadband users and the second largest
by mobile phone users. The region boasts three of the largest African markets by number of
subscribers – Egypt, Algeria and Morocco. Unlike most of Sub-Saharan Africa, the fixed telephony
segment is relatively well established. The fixed telephony segment accounted for 77% of the
subscriptions in Africa in 2019 or 18.6mn.
Universal access to digital technology has become a top priority in many countries in the wake of
COVID-19. Take Morocco for example – the country adopted the Digital Morocco 2020 plan that aims at
lowering the digital divide in the country by 50%, connecting 20% of the SMEs, digitising 50% of
administrative tasks and training 39,000 ICT professionals. It is critical to build internet infrastructure,
but also to develop a digital economy in order to create the content and services that leverage the
infrastructure.
Source: ITU, World Bank, CEIC, Broadband Commission, GSMA Intelligence

Northern Africa (cont’d)
Comments
Although the region has a well-developed fixed-line broadband segment, the penetration rate is low
with Tunisia having the highest rate of 10.2 fixed-line broadband users per 100 inhabitants, according
to data compiled by ITU. The most advanced is 3G technology, accounting for 51% of all mobile
subscriptions, with 4G adoption low at just 14% of the subscriptions in 2019.
ICT funding has been lower than in Southern and Western Africa in the 2015–2018 period, mainly due
to lack of investment from China. In 2018, the region attracted investments of USD 779mn, slightly up
from USD 759mn in 2017. The short-term investment is not bright given the budget cuts that have
been announced in some countries (Algeria and Tunisia) amid the COVID-19 pandemic and this may
delay significant investments in network and technology projects. Markets are still not fully
liberalised and the privatisation of Algerie Telecom and Tunisie Telecom is unlikely in the short term.
Mobile access is the highest in Africa with most countries having over 60% internet access rate. The
region could benefit, however, from translating this access into a thriving digital economy. Morocco
for example, boasts the highest internet access rate of 74.4% and 133% mobile penetration rate,
according to the World Bank report 2019, but only 29% of its adult population has bank accounts. In
March 2020, Orange launched its Orange Money mobile money service, enabling clients to make
mobile payments and transfer money using their phones.
Fixed-Line Broadband Users by Country Active Mobile Broadband Users by

Country*
Egypt 7,598 Egypt 59,572
Algeria 3,582
Algeria 41,325
Morocco 1,751
Morocco 23,677
Tunisia 1,193
Sudan 16,241
Libya 318
Sudan 32 Tunisia 9,097
*Data for Libya was not available
Source: ITU, World Bank, CEIC, Orange Morocco

Western Africa
Users by Country, 2019
Burkina Faso
Mobile Phone Users: 20,364,508 Others
Fixed-Line Telephone Users:
75,291 Mobile Phone Users:
Senegal 346,819,733
Mobile Phone Users: Users: 1,152,617
17,880,594
Users: 207,592
Nigeria

Fixed-Line Telephone Users: 107,154
Ivory Coast
Ghana
Mobile Phone Users:
37,376,603 Mobile Phone Users: 40,857,077
Fixed-Line Telephone Fixed-Line Telephone Users:
Users: 271,724 288,531
Comments
Western Africa is the largest mobile market in Africa, boasting 347mn users in 2019, or 35.2% of the
continent’s total. Nigeria is by far the biggest market with its subscribers making up more than half of
the total – at 184.6mn in 2019, up 7% y/y. Ghana and Ivory Coast follow with respective shares of 11.8%
and 10.8%. Ghana is positioning itself as a solid contender in the region with major decisions taken in
2020. In April 2020, Ghana signed a deal with US Parallel Wireless to connect up to 2,000
communities. ParInvestment Fund for Electronic Communications (GIFEC), a government programme
to help bridge the country’s digital divide, signed a deal with OpenRAN provider Parallel Wireless to
connect up to 2,000 underserved communities in the country’s rural areas. In addition, smart phone
adoption increased from 38% in 2018 to 45% in 2019. This was driven by operator investments in
network expansion over the last two years as well as mobile phones becoming affordable.
Increased infrastructure investments and decreasing mobile device prices have led to a growth of 49%
in the region’s 3G connection. Growth is also spurred by the large younger population. More than 40%
of the region’s population are under 18 years, who will be first-time mobile phone owners.
Source: ITU, World Bank, CEIC, GSMA Intelligence, Mobile World

Western Africa (cont’d)
Comments Active Mobile Broadband Users by

Country, thou
Mobile broadband usage has improved
significantly in recent years as a result of Niger ia 72,153
investments in submarine fibre-optic cables, thus Ghana 30,387

increasing wide access to more advanced Ivory Coast 17,021
network connections. Apart from Cape Verde, no Senegal 8,840
other Western African country has an internet
Burkina Faso 6,441
rate of over 50% internet access, despite the fact
Togo 3,322
that more than four international submarine
Guinea 2,958
cables cross the region. Only the coastal areas
stand a change to benefit as landlocked countries Benin 2,532
remain constrained due to the challenges of Mauritania 2,513

infrastructure shortages. Nigeria is the largest Guinea-Bissau 705
market by number of mobile users, thanks mainly Cape Verde 420
to the fact that it is the most populous country in
the region. Internet penetration stands at 42% as,
alongside lack of infrastructure, lack of access to
electricity presents a major obstacle. Hence the Fixed-Line Broadband Users by Country
continued problem of multiple SIM card
ownership as consumers shield against loss of Ivory Coast 216,723
coverage, especially in the rural areas of the Senegal 152,047
country. Niger ia 83,360
Ghana 58,518
In 2019, Western Africa was the fastest growing
Sub-Saharan African region in terms of mobile Togo 31,899
money accounts (14.5%) and transaction value Benin 25,032
(34.9%). Cape Verde 19,066

Burkina Faso 12,015
Mauritania 10,815
Guinea 1,250
Guinea-Bissau 1,227
*Data for Libya was not available
Source: SMSA Intelligence, GMSA, ITU, Economist, UNCTAD, Intracen,

Eastern Africa
Users by Country, 2019 Kenya

Uganda 70,394
Mobile Phone Users:
25,395,503
Users: 76,492
Zambia
Mobile Phone Users:
17,220,607 Tanzania
Users: 96,719 Mobile Phone Users:
47,685,232
76,288
Others
Mobile Phone Users:
43,558,839
Users: 837,135 Mozambique
80,791
Comments
Eastern Africa ranked third on the continent by number of mobile phone subscriptions in 2019, though
the number of users fell by 1.5% y/y to 203.2mn. Although mobile penetration is growing steadily in
the region, the majority of users have 2G network devices. Even so, telecoms’ investments in
infrastructure improvement has helped the largest markets in the region to expand their mobile
internet penetration rates, with Zambia and Tanzania doubling them to 26% and 18% in 2019 from 13%
and 9% in 2014, data from GSMA Intelligence showed. The Seychelles leads the pack with a mobile
phone penetration of 198% and internet access of 58.8% in 2019. The other two countries in the region
with a mobile phone penetration rate above 80% are Kenya (104%) and Tanzania (82%).
The numbers of fixed telephone lines in the region continued to decline due to the lack of
infrastructure development, thus too expensive to access or no incentives for investors to invest in
the market.
Source: ITU, World Bank, CEIC, GSMA intelligence, Speedtest

Eastern Africa (cont’d)
Comments
Eastern Africa is one of the most untapped regions on the continent due to governmental dominance
across various markets such as Eritrea, Ethiopia, Sudan and Somalia. On the other hand, Tanzania,
Sudan and Uganda, enjoy the presence of international telecoms such as MTN, but telecoms lack the
incentive to invest in rural network expansion, as most of the population in these areas has low
purchasing power. Among the unliberalised markets, Ethiopia is the most lucrative one given its large
population numbers and the growing middle class. Ethiopia’s main telecommunications company
Ethio services around 110mn people but only has a mobile penetration of 42%. Delayed market
liberalisation is leading to an inefficient monopoly and a lack of diversification of service providers
stifling growth. In 2019, the country’s telecommunications regulator, the Ethiopian Communications
Authority announced it will issue two new operator licences and move ahead with plans to offer
partial ownership stakes in Ethio Telecom. February 2021 has been set as a deadline for issuing the
licences and offering for sale 49% of Ethio Telecom Looking ahead, Ethiopia’s telecom and IT sector
holds high growth potential due to its low existing market penetration and strong government
willingness to partner with the private sector to carry out its ambitious development plans. In
November 2020, the Ethiopian government plans to sell 49%. Potential buyers include MTN, Vodacom
and its Kenyan subsidiary Safaricom, Orange and Etisalat. Other markets in the region that have been
held back by state-owned monopolies are Eritrea and Djibouti. In Eritrea only 1.9 in 100 people had a
fixed-line phone in 2019 and the mobile phone rate was 20.4 per 100 inhabitants. Low levels of
electrification and legacy fixed-line infrastructure shortages have resulted in Eastern Africa having
one of the lowest penetration rates on the continent with a fixed-line broadband rate of just 20%.
Tanzania leads the way in fixed broadband access with over 1mn subscribers in 2019.
Fixed-Line Broadband Users by Country, 2019
Tanzania 1,039,655
Kenya 491,183
Mauritius 307,200
Zimbabwe 204,424
Zambia 88,891
Mozambique 69,975
Seychelles 26,974
Djibouti 24,416
Malawi 11,358
Rwanda 8,885
Burundi 3,891
Comoros 1,181
South Sudan 200
Source: ITU, World Bank, CEIC, Ethio Telecom, Bloomberg

Eastern Africa (cont’d)
Comments
In order to develop their broadband network, a number of countries in the region have put in place
national programmes. In Tanzania, the National ICT Broadband Backbone is aiming to boost fibre
network availability for urban consumers and businesses. In Ethiopia, under the National Broadband
Plan 2016, the government has set a goal of fixed-line broadband coverage to 10% of the population.
Among the underperforming in Africa are the two eastern African countries South Sudan and Eritrea
where unique mobile internet subscribers make up less than 10% of the population. The Seychelles
and Djibouti remain the exceptions, where the shares of unique mobile internet subscribers are
greater than or equal to 40% of the population.
A report by the Alliance for Affordable Internet published in December 2020 showed that only 10
countries in Africa meet the minimum internet affordability target, which is where the cost of 1 GB of
mobile broadband costs no more than 2% of the average monthly income. None of the eastern African
countries make the list and they fall within countries where costs are higher than 2% of the monthly
income. Still, major improvements in that area were reported by some countries in the region. In the
case of Rwanda, the price of 1 GB as a fraction of the average monthly income in that country
decreased from 20.16% to 3.39% between 2015 and 2019.
Active Mobile Broadband Users by Country, thou, 2019
Kenya 21,595
Zambia 9,121
Zimbabwe 7,569
Tanzania 5,679
Mozambique 5,365
Rwanda 5,341
Burundi 1,284
Mauritius 1,109
South Sudan 658
Djibouti 230
Seychelles 89
Comoros 80
Source: ITU, CEIC, Alliance for Affordable Internet, World Bank

Southern Africa
Botswana
Namibia
Mobile Phone Users: Fixed-Line Telephone Users:
2,823,655 142,587
Users: 139,698
South Africa
Mobile Phone Users: 96,972,459 Lesotho
2,024,730 Mobile Phone Users: 1,583,192
13,426
Comments
Southern Africa is the third largest region in terms of mobile subscriptions and the second by number
of fixed-line telephony users. With its 105.1mn mobile telephony subscribers the region accounted for
10.7% of Africa’s total users in 2019. In the fixed-line telephony segment, the region made up 9.5% of
the continent’s overall users. South Africa is the leading market in the region in both segments with
respective shares of 92.3% and 87% in 2019.
The region stands out with high penetration rates. All four countries in the region boast mobile phone
penetration rates above 100% – Botswana (173.8%), South Africa (165.6%), Lesotho (113.8%) and
Namibia (113.2%). Internet access is also high by continental standards with South Africa and Namibia
recording 56.2% and 51%, respectively in 2019, according to data provided by the World Bank.
Southern Africa attracted USD 5.8bn in ICT funding commitments in the 2015–2018 period. In 2018
alone 55% of the investments went to South Africa, reaching a total of USD 3.98bn.
Source: World Bank, GSMA Intelligence, ITU, CEIC, ICA

Southern Africa (cont’d)
Comments
A notable improvement in the development of fixed broadband started in 2016, when South Africa’s
Telkom initiated a migration of its ADSL customers to fibre. The South African government’s
programme also aunched it SA Connect, which is expected to boost broadband services. COVID-19 gave
the digital economy a strong boost through digital payments and online shopping. South Africa will
continue to lead in this region given the strong public investments, growing fixed-line fibre
installation and the use of VoiP as broadband adoption expands. However, low regulation and stiff
competition as a result of the monopoly exerted by the two main players – MTN and Vodacom – will
affect the rate of broadband take-up, especially by the low-income segment of the market due to the
high costs. A more flexible and competitive process will ensure South Africa achieves its goals of
universal access.
After the COVID-19 outbreak, mobile operators in the region experienced tremendous pressure as
demand for network traffic increased exponentially due to mandatory lockdowns. While governments
provided temporary spectrum increases to accommodate the demand, operators also had to make
temporary infrastructure arrangements. This, coupled with decreased demand for SMS and voice
services, put pressure on operators’ margins, exacerbated by the decreased economic pressure that
reduced consumer spending. Where demand was increasing, in terms of stable and affordable
internet packages, telcos have been unable to remain competitive due to consistently high data
packages, which became even more unaffordable as the pandemic wreaked havoc.
Active Mobile Broadband Users by Fixed-Line Broadband Users by Country,

Country, thou, 2019 2019
South Africa 59,858

South Africa 1,250,356
Botswana 2,037
Botswana 49,295
Namibia 1,651
Lesotho 6,329
Lesotho 1,361
Source: World Bank, GSMA Intelligence, ITU, CEIC

Central Africa
Others
Mobile Phone Users: Chad
8,172,139
Users: 40,116 Fixed-Line Telephone Users: 6,524
Cameroon
Mobile Phone Users:
21,400,736
Fixed-Line Telephone Users: Congo
856,411
Fixed-Line Telephone Users: n/a
Gabon
Mobile Phone Users: Angola

2,992,811
Fixed-Line Telephone Users: Mobile Phone Users: 14,830,154
22,291 Fixed-Line Telephone Users: 124,726
Comments
The least developed region in Africa in terms of ICT is Central Africa mainly due to the ongoing
political instability which often leads to destroying infrastructure and disrupting markets. Only 10% of
households in the Economic Community of Central African States have access to a computer and the
internet, while about 1 in 100 inhabitants subscribes to fixed-line telephony, compared to 49 in 100 for
mobile telephony. Furthermore, only 46% of the population has access to the 3G mobile network. In
2019, Central Africa accounted for only 9.5% of the continent’s mobile subscriptions with its 94.2mn
users in 2019 and a mere 0.4% of the fixed broadband subscriptions (67,900). Mobile phone
penetration rates are low, with the exception of Gabon and the Republic of Congo (138% and 95%,
respectively in 2019). Internet access in all of the countries except Gabon is low, at or below 30% and
in many countries it is even below 10%.
Source:

Central Africa (cont’d)
Comments
Though central Africa governments are investing extensively in ICT, the amount of FDI a region
attracts is highly correlated with the level of economic development. Thus, given the low level of
economic development in the region it is the second lowest in terms of ICT investments attracted over
2015-2018. Nonetheless, some countries – Gabon being an example - have successfully created an
enabling environment for digital economy beyond mobile adoption. Over 80% of the population uses
digital payments. Though Gabon has a mature mobile market with high penetration levels, a more
centralised government systems stifles competition as the government exerts monopoly on the
existing SAT-3/WASC/SAFE submarine cable. During the Covid-19, the proliferation of mobile money in
the region also allowed governments to disburse aid and information in an attempt to fight the
pandemic. The government’s digital strategy included putting in place new public and regulatory
policies to create an environment conducive to the sector’s development, to promote competition and
innovation, and to attract new international investors. Among the more mature markets are
Cameroon, Angola and DRC. Countries in the region, among which Cameroon and Gabon, benefit from
the presence of large international telecoms MTN, Orange, Maroc Telecom etc., but the business
environment as a whole remains unsupportive.
Fixed-Line Broadband Users by Country, Active Mobile Broadband Users, by

2019 Country, thou, 2019
Cameroon 400,929 DRC 16,950
Angola 119,068 Angola 6,740
Gabon 22,332
Cameroon 3,785
DRC 11,900
Gabon 2,048
Sao Tome & Principe 1,642
Chad 475
Republic of Congo 500
CAR 238
CAR 499
Chad 68 Sao Tome & Principe 73
Source: ITU, World Bank, CEIC, GSMA Intelligence

03
NIGERIA

03 NIGERIA CONTENTS
Sector Snapshot
Nigeria
Telecommunications
ICT MARKET VALUE
EXPORTS GVA Telecoms Revenue

NGN 11,891bn Mobile Services:
USD 211.9mn ICT Services NGN 1,785bn
ICT Services Fixed-Line Services:
NGN 4,108bn
TELECOM MARKET
IMPORTS
USD 290.8mn
ICT Services Mobile Fixed-Line Internet
Mobile Telephone Fixed Telephone Internet Users:
Subscriptions: 184.6mn Subscriptions: 107,154 46.2mn
Penetration Rate: 88.2 per Penetration Rate: Penetration Rate:
100 people 0.07 per 100 people 47.4 per 100 people
Active Mobile Broadband Fixed Broadband
Subscriptions: 72.2mn Subscriptions: 73,965
3G Subscriptions: 50.4mn Penetration Rate:
4G Subscriptions: 21.7mn 0.04 per 100 people
KEY PLAYERS, NOV 2020

1. MTN Nigeria Communication: 82mn mobile telephone users, 39.5% market share
2. Airtel: 57.2mn mobile telephone users, 27.6% market share
3.Globacom (GLO): 55.1mn mobile telephone users, 26.6% market share
4.9Mobile: 13.2mn mobile telephone users, 6.4% market share
Note: Data for 2019, unless otherwise stated.

Source: NCC, IT, World Bank, CEIC, Nigeria Central Bank, Nigeria Statistics Office

03 NIGERIA CONTENTS
Sector Snapshot
Nigeria Telecommunications Sector
Nigeria’s telecommunications sector generated a gross value added (GVA) of NGN 11.9tn in 2019, a
23% nominal rise, according to data provided by the country’s statistics office. In real terms, the
sector’s GVA grew by 11.4% y/y. As a percentage of the country’s nominal GDP the sector equalled 8.3%
in 2019.
Nigeria remains the biggest market by size in Africa and the continent’s largest technology hub,
boasting over 60 hubs in 2019. The number of mobile subscribers grew by 6.9% y/y in 2019 to reach
184.6mn, accounting for 18.6% of Africa’s total and for 2.2% of the global total. After a slight increase
of 0.8% y/y in 2018, the fixed-line telephony segment resumed its downward trend with the number of
subscriptions falling by 23.7% y/y to 107,154 in 2019.
Nigeria’s telecom sector benefits from five international submarine cables, with a combined capacity
of over 20 TB. Despite the bandwidth capacity, the sector suffers from significant infrastructure gaps
when it comes to local networks. According to the government national plan, the country is still in the
process of installing a national fibre network that aims to improve broadband access to 90% of the
population by 2025. In 2019, MTN, ipNX and 21st Century installed a total of 13,892km of fibre cables.
COVID-19 has amplified the need for digital connection beyond mere access. While Nigeria
outperformance is driven by population and market liberalisation, digital transformation remains
behind the optimal potential with several obstacles to overcome. According to the European
Investment Bank (EIB), there are over 30,000 mobile towers in the country, but over 100,000 are
needed to adequately cover the population. Moreover, according to GSMA Intelligence 2020 report, it
is estimated that about 26,000 of the towers are found to be off-grid and bad-grid towers, mainly due
to over reliance on diesel. Thus growth opportunities lie in providing renewable energy-powered
towers.
The present competitive landscape is the result of the sector’s liberalisation, which started in 1992
and was completed in 2000. The main players are MTN Nigeria, part of South African MTN Group, the
100% Nigerian-owned Globacom and Airtel Networks, a unit of Indian Bharti Airtel. MTN is the largest
mobile operator, with a 37.3% market share as of end-2019, according to data provided by the Nigerian
Communications Commission (NCC). GLO ranks second with a 28% market share. Both MTN and GLO
are also present on the fixed-line segment. Airtel, operating solely in the mobile segment, had a 27.2%
market share at end-2019.
Source: NCC, ITU, CEIC, GSMA Intelligence

03 NIGERIA CONTENTS
Sector Outlook
Key Indicators Forecasts

2019e 2020e 2021f 2022f 2023f 2024f
Mobile Cellular Subscriptions, mn 184.4 198 203.1 211.4 226.3 246
Mobile Cellular Subscriptions, y/y change, % 6.8 7.4 2.6 4.1 7.0 8.7
Mobile Cellular Suscriptions per 100 people 91.8 96.1 96.1 97.5 101.9 108
Fixed Telephone Subscriptions, thou 136 134 131 128 125 121
Fixed Telephone Subscriptions, y/y change, % -2.9 -1.5 -2.2 -2.3 -2.3 -3.2
Fixed Telephone Subscriptions per 100 people 0.1 0.1 0.1 0.1 0.1 0.1
Internet Penetration, % n/a 45.5 49.4 53.6 59.2 69.7
Fixed Telecoms Revenue, USD mn 43 35.7 27.8 25 22.9 21.2
Mobile Telecoms Revenue, USD mn 5,552 5,007 4,375 4,585 4,683 4,848
Telecoms Investment, % of GDP 0.4 0.4 0.4 0.4 0.4 0.4
Comments
The Nigerian telecommunications market has great potential for further growth owing to its large and
growing young population, which has led to a strong uptake of broadband, mobile and content
delivery services. The industry also continues to draw from the past decade’s private investments in
network connectivity and ICT infrastructure. The strong regulatory reform, which has already yielded
positive results, is expected to lead to deeper digital transformation and a diversified digital
economy. Being one of the largest tech-hub to have attracted international investors, opportunities
for the sector lie in the underpenetrated mobile broadband market, the unsaturated mobile market
especially in the rural areas and the low-income segment. COVID-19 and the associated fall in oil
prices will restrict growth in this sector in the short term. The mobile segment is forecast to grow at a
CAGR of 5.9% over the 2019–2024 period, according to EIU. Main drivers are seen to be the operators’
different promotion strategies, the ownership of two or more SIM cards and the extension of network
coverage. Additionally, the three largest mobile operators in the country, MTN, GLO and Airtel are
expected to continue with the aggressive deployment of their 3G and 4G networks. The downturn in
the fixed-telephony segment is expected to continue, with users declining at a CAGR of 2.3% over the
2019–2024 period, as the segment suffers from poor infrastructure and lack of investments.
Source: EIU, Nooz

03 NIGERIA CONTENTS
Driving Forces
External
The liberalisation of the sector that has started in the 2000’s has been a major growth driver over the
years ending the state-held monopoly on the fixed-line sector and resulting in increased competition
and more private investments. Furthermore, the sector has benefited from the global technological
advancements with the country boasting five international submarine fibre-optic cables, with a
combined capacity of over 20 TB. The COVID-19 pandemic vid-19) has positively impacted the telecoms
sector with the higher number of people staying at home leading to an expansion in the demand for
digital services. Additionally, the pandemic has led to a shift in the pattern of usage – with the higher
demand for data services offsetting a decline in voice traffic.
The Nigerian fintech landscape holds significant potential to grow telecom srevenues exponentially in
the future. The pandemic is accelerating changes in consumer behavior, with fintech positioned to
plug the gap left by traditional banks and create new products and services that add value to
consumers and support them during this challenging time.
Internal
Market liberalisation has allowed foreign operators to bring in their experience and finance to expand
the country’s network coverage, improve its quality and increase the variety of services. Recently, the
deployment of UMTS-900, which involves reusing part of the 2G spectrum in 900 MHz to deploy 3G,
has led to an accelerated and cost-effective roll-out of 3G. According to the GSMA Intelligence 2020
State of Mobile Report, Nigeria’s 3G coverage reached 78% in 2019, with 20mn people covered during
the year. In addition, since its first roll-out in 2016, the 4G network had 45% coverage as of 2019.
Another important aspect is formal professional tech knowledge and general informal tech. According
to a 2020 joint report by the IMF and Google, Nigeria is among the top three countries that boast a
50% share of more than 700,000 professional developers across the whole of Africa. This makes it
easier for innovators looking to expand into the Nigerian tech hub. Also, according to the GMSA
Intelligence report, mobile internet awareness in the country increased from 33% in 2014 to 70% in
2019. This has led to an increased adoption of 3G mobile devices. This was also supported by the
relatively cheap 3G mobile devises. Data affordability also drove market diversification as more
people move away from SMS and voice calls into the use of mobile data.
Source: NCC, ITU, GSMA Intelligence, EIB, IMF

03 NIGERIA CONTENTS
Restraining Forces
External
Although the telecoms sector has benefitted from the COVID-19 pandemic, the sector will be subject
to hard economic pressure and reduced consumer spending as incomes shrink due to joblessness.
These external factors could deter investors as their appetite for risk may be skewed, leading them to
seek safer markets. The pandemic has made clear that more business opportunities lie in digital
economy, which involves data, data storage, data privacy and ownership. Nigeria’s legal and
regulatory framework is lacking in this regard. The legal vacuum and bureaucratic hurdles have also
compromised the expansion of fibre networks and the telecom sector as a whole. According to the
World Bank, an estimated 85mn people are without electricity, while 176mn cannot access
technologies. Electricity is fundamental for the growth of the telecommunication sector and digital
economy. Telcos in Nigeria also face challenges in electricity and fuel shortages, which are disruptive
to network operation, various taxes that chip away at revenues (recent Netflix, WhatsApp and
Facebook taxes caught operators off-guard), and cumbersome bureaucratic procedures that in some
instances have led to failure of project implementation. In 2018, for instance, IHS Towers returned its
licence to expand broadband infrastructure due to failure to secure local state government approval.
Internal
The lack of quality infrastructure for mobile operators and underdeveloped fixed-line continues to
hamper the potential of the sector. Despite significant public and private investment in ICT
infrastructure, limited domestic network capacity remains an issue. Where investments have been
made, such as in subsea cable systems, capacity remains underutilised. The current undersea cables
offer 20 TB of bandwidth. During the pandemic, an opportunity was missed as demand for e-
governance, health, banking and education services heightened, while domestic network constraints
continued. Only the major cities of Lagos, Port Harcourt and Abuja have fibre infrastructure that could
be considered sufficient. Nigeria has been ranked 3rd globally for cybercrime cases, according to Fitch
Solutions, and in order to tackle the issue the government has made registration of SIM cards
compulsory and started a process of SIM card verification. While data costs have significantly dropped
over the years, they remain high by global standards due to regulatory inefficiencies and high tariff
rates. The lack of any policy to allow the entrance of low-cost mobile virtual network operators
(MVNOs) also compromises the sector’s growth prospects, as a large portion of the country’s
population is unable to afford the costs associated with traditional data plans.
Source: World Bank, Frost & Sullivan, Fitch Solutions

03 NIGERIA CONTENTS
According to a Fitch Solutions report, telecoms services around the world are not expected to be
directly affected by COVID-19 as their role in enabling individuals and organisations to continue
functioning at a time of crisis remain vital until COVID-19 is no longer a threat. Affordable and fast
mobile data packages will continue to be main revenue drivers especially as countries battle with the
pandemic into 2021. In March 2019, Watt Renewable partnered with Nigeria-based tower company Pan
African Towers to provide renewable energy to the company’s tower sites in Nigeria. The second
largest player Airtel, acquired additional frequencies in the 2600 MHz band to bolster its spectrum
assets for further network deployments in December 2019. In 2020, MTN the largest player resolved its
legal woes with the government while also acquiring a mobile money licence.
According to an IMF report, mobile operators face competition from over the top (OTT) operators such
as Facebook and WhatsApp. However, there is an opportunity for MNO’s to provide premium mobile
data packages and broadband to support demand. Mobile money continues to be a lucrative
opportunity in addition to a shift in entertainment needs as a result of the pandemic. Online
entertainment in gaming or streaming (e.g. Netflix) are attractive to the large young population of
Nigeria. E-commerce also presents a small but growing market segment and has given rise to demand
for secure payment services such as Paypal and Opera.
According to Fitch Solutions, the mobile market will generate some 32.6mn new mobile subscriptions
by 2023 (a CAGR of 3.5%), while GSMA Intelligence sees 31mn additional subscriptions by 2025 (close
to a fifth of the new subscriptions forecast for the whole Sub-Saharan region). Hence, the most
strategic move would be for mobile operators to tap into the rural areas where network coverage is
still dwindling. Expanding 3G and 4G coverage in these areas will therefore drive growth.
In January 2020, the NCC announced a planned investment of US$ 732 mn for the rehabilitation and
development of fibre networks. Under the investment plan, the government will contribute US$
137 mn, with the remainder provided by six private infrastructure companies. The invested funds will
go towards the laying of 30,000 km of fibre optic cable, almost doubling the existing network.
While the country benefits from an increasing level of bandwidth capacity thanks to the continued
installation of undersea cables, limited development of data hosting and local network infrastructure
has made these investments largely useless. For example, MainOne’s subsea cable has been running
at an average of 10% capacity since its launch in 2010 due to the lagging development of the national
fibre network. This has resulted in extremely low fixed-broadband penetration outside the country’s
main urban centres of Lagos, Abuja and Port Harcourt.
Source: Fitch Solutions, GSMA Intelligence, Deloitte

03 NIGERIA CONTENTS
In January 2020, the NCC announced a planned investment of USD 732mn in the rehabilitation and
development of the country’s fibre-optic network. Under the investment plan, the government will
contribute USD 137mn, with the remainder provided by private infrastructure companies. The invested
funds will go towards the laying of 30,000km of fibre-optic cable, almost doubling the existing
network.
While the country benefits from increasing bandwidth capacity thanks to the continued installation of
undersea cables, limited development of data hosting and local network infrastructure has made
these investments largely useless. For example, MainOne’s subsea cable has been running at an
average of 10% capacity since its launch in 2010 due to the lagging development of the national fibre
backbone network. This has resulted in extremely low fixed-broadband penetration outside the
country’s main urban centres of Lagos, Abuja and Port Harcourt.
Affordable and fast mobile data packages will continue to be main revenue drivers, especially as
countries battle with the pandemic into 2021. In March 2019, Watt Renewable partnered with Nigeria-
based tower company Pan African Towers to provide renewable energy to the company’s tower sites
in Nigeria.
Nigeria’s mobile market will generate some 32.6mn new mobile subscriptions by 2023, according to
Fitch Solutions, while GSMA Intelligence sees 31mn additional subscriptions by 2025 (close to one fifth
of the new subscriptions forecast for the whole Sub-Saharan region). Hence, the most strategic move
would be for mobile operators to tap into the rural areas where network coverage is still dwindling.
The expanding 3G and 4G coverage in these areas will drive growth.
Mobile money continues to be a lucrative opportunity in addition to a shift in entertainment needs as

a result of the pandemic. Online entertainment in gaming or streaming (e.g. Netflix) are attractive to
Nigeria’s large young population. E-commerce also presents a small but growing market segment and
has given rise to demand for secure payment services such as Paypal and Opera.
Source: GSMA Intelligence, Deloitte, Fitch Solutions

03 NIGERIA CONTENTS
Mobile Telephony Market Structure, end-Nov 2020
MTN
Number of Subscribers: 82mn
Market Share: 39.5%
Airtel
Number of Subscribers: 57.2mn
Market Share: 27.6%
Globacom
Market Share: 26.6%
9Mobile
Market Share: 6.4%
Nigeria has four active GSM operators – MTN, Airtel, Globacom and 9mobile. MTN is majority owned by South
Africa’s MTN Group, one of Africa’s leading mobile companies with operations in 22 countries across the continent
and the Middle East. MTN has been the market leader since its launch in 2001. According to the latest available
data from NCC, MTN continued to be the undisputed market leader with 82mn subscribers as of end-November
2020, corresponding to a market share of 39.5%. Airtel managed to grow its subscriber base by 2.4mn users since
August 2020, helping it to overtake Globacom’s position as the country’s second biggest mobile operator. By end-
November, Airtel had 57.2mn users, which represented a 15.1% y/y rise. Airtel is owned by India’s Bharti Airtel,
which entered the Nigerian market in 2010. Airtel Africa has operations in 14 African countries, of which Nigeria is
the biggest market. Locally owned Globacom was founded by its chairman Mike Adenuga and received a licence
to become Nigeria’s second national operator in August 2002. Globacom also operates in Ghana, Benin, Ivory
Coast, Senegal and The Gambia.
Source: NCC, Reuters

03 NIGERIA CONTENTS
Competitive Landscape (cont’d)
Fixed-Line Telephony Market Structure, end-Nov 2020
21st Century
Number of Subscribers: 96,489
Market Share: 89.2%
MTN Fixed
Market Share: 7.4%
Glo Fixed
Market Share: 2.1%
ipNX
Market Share: 1.3%
Four operators were providing fixed-line services in Nigeria as of November 2020, according to data
from the country’s telecoms regulator, the NCC: 21st Century Technologies, ipNX and the fixed-line
units of MTN and Globacom. The lion’s share of 89.2% of all subscriptions is controlled by 21st Century
Technologies. MTN Fixed, controlled by the country’s largest mobile services provider MTN, ranked
second with 7,998 connections and a market share of 7.4% at the end of November 2020.
There were 108,160 fixed-line connections at the end of November 2020, up 0.4% y/y. ipNX, the
smallest player, announced in September 2020 it signed a deal with the United States Trade and
Development Agency (USTDA) to invest in development of Nigeria’s ICT and broadband infrastructure.
The partnership will enable ipNX to expand its fibre-optic network to more than 200,000 residences in
Lagos and other locations, including Abuja and Port Harcourt.
Source: NCC, Company Data

03 NIGERIA CONTENTS
M&A Deals
M&A Deals in Nigeria’s Telecommunications Sector, 2016–2020
Deal Value,
Date Target Company Deal Type Buyer Country of Buyer Stake, %
USD mn
Vodacom Business
Africa’s operations in inq. Holdings Ltd; Convergence Partners
Mauritius; South n/a
May-2020 Nigeria, Zambia, and Acquisition Investments Ltd 100
Africa
Ivory Coast
Minority
Jan-2019 Airtel Africa Qatar Investment Authority Qatar 200.0 n/a
Stake
Main One Cable Co

Sep-2018 Acquisition Orange France n/a 100
Nigeria Ltd
Western Technology Investment; Social

Capital; Y-Combinator; Lynett Capital
Minority United States;
Sep-2018 Tizeti Network Ltd Partners; 4DX Ventures Management 3.0 n/a
Stake Ghana
LLC; Friale; Golden Palm Investments
Corporation
United States;
Western Technology Investment; Social
United Arab
Minority Capital; VY Capital; Picus Capital; ACE &
Jun-2018 Tizeti Network Ltd Emirates; United 2.1 n/a
Stake Company; Lynett Capital Partners; Zeno
Kingdom;
Ventures; Private investor(s)
Switzerland
Minority
May-2017 Tizeti Network Ltd Zeno Ventures Switzerland n/a n/a
Stake
784.55
IHS Holding (IHS Minority
Feb-2017 MTN Group Ltd South Africa (Market 14
Towers) Stake
Estimate)
127.0
Minority
Nov-2016 Airtel Networks Ltd Bharti Airtel Ltd India (Market 4.2
Stake
Estimate)
NatCom Development
Jul-2016 Acquisition Private Investor(s) n/a n/a
& Investment Ltd
Broadband 4 Africa
Minority
Jun-2016 Ltd (Broadband for InfraMed Management SAS France n/a 21
Stake
Africa)
Suburban Fiber Minority

Mar-2016 Synergy Capital Managers Ltd Nigeria n/a n/a
Company Ltd Stake
1,211
Mar-2016 telecommunication Acquisition IHS Holding (IHS Towers) Nigeria n/a 100
towers in Nigeria
Visafone
Jan-2016 Acquisition MTN Group Ltd South Africa n/a 100
Communications Ltd
Source: EMIS DealWatch

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ANRT Morocco’s Telecommunications Regulatory Agency

ARPU Average Revenue Per User

CAGR Compound Annual Growth Rate

CAK Communications Authority of Kenya

COVID-19 Coronavirus Disease 2019

EIU The Economist Intelligence Unit

EGP Egyptian Pound

ICA Infrastructure Consortium for Africa

ICT Information and Communication Technology

ITU International Telecommunication Union

KES Kenyan Shilling

LTE Long-Term Evolution

MAD Moroccan Dirham

MCIT Egypt’s Ministry of Communications & Information Technology

NCC Nigerian Communications Commission

NGN Nigerian Naira

NTRA Egypt’s Telecommunication Regulatory Authority

PPP Public Private Partnership

VOIP Voice Over Internet Protocol

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02 REGIONAL OVERVIEW p.20

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AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 7

Sector Overview (cont’d)

*Data for Africa excluding Arab countries

Source: IFC, ITU, World Bank, Africa & Bandwidth Maps

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 8

Sector Overview (cont’d)

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 9

Sector Overview (cont’d)

Source: ITU, GSMA Intelligence,

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 10

Sector Overview (cont’d)

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 11

2. India 9. The Philippines

Source: ITU, CEIC, World Bank

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 12

Mobile Money Registered Accounts, mn, end-2019

Source: ITU, GSMA Intelligence

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 13

Africa in Global Fixed-Line Telephony*, 2019

4.6 31. Algeria

2.0 54. South Africa

1.5 62. Tunisia

0.5 86. Mauritius

*191mn fixed-line telephony subscribers; 20.9% – share of global

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 14

Africa in Global Fixed Broadband,* 2019

0.4 88. Cameroon

*449.3mn fixed-line broadband subscribers; 39.6% – share of global

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 15

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 16

National Broadband Policies

Policy Year of Policy

Source: ITU: The State of Broadband 2018

AFRICA TELECOMMUNICATIONS SECTOR 2021/2022 17

National Broadband Policies

Policy Year of Policy

Sao Tome and