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South Africa: LTE Rollouts, Network Investments and Undersea Cables to Boost Competition and Revenue
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Introduction and Landscape
We expect South Africa's telecom market revenue to grow at a CAGR of 2% over the forecast period, from estimated $14.4bn in 2013 to $16.1bn in 2018. Mobile communications was once again the dominant telecom sector in 2013, generating $10.2bn. However, as market players get pulled into aggressive price wars with further cuts in mobile termination rates, we expect voice revenue to decline at a compound rate of -2% over the forecast period. Over the next few years, the most significant growth in the market should occur in mobile data and fixed VoIP services. We project that mobile data revenue will almost double from its 2011 figure of $2.8bn to surpass $5bn in 2018. The rise of VoIP will be similarly strong and can be credited to new offers for businesses, principally targeting the small and midsize enterprise (SME) segment. We expect revenue from these services to grow at an impressive CAGR of 29%, from $46m in 2013 to $160m in 2018. The biggest declines will come in dial-up Internet, which is expected to be dwarfed by broadband Internet following recent and expected activations of new submarine cables.
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