Wednesday, August 26, 2009

Mobile phone industry in Zimbabwe to grow by 40%

Mobile phone industry in Zimbabwe to grow by 40%
By SARAH NCUBE
Published: August 25, 2009
ZIMBABWE – HARARE The country’s three mobile phone operators are expected to reach a market perpetration of 40 percent within the next five years up from 10 percent.
The penetration rates is one of the lowest in the world.
The sector is described as still being in the high growth phase.According to a report compiled by Mopane Advisory Services, there had been intensifying competition among the three mobile network providers with Telecel Zimbabwe in the process of recapitalising its operations.
To demonstrate the huge untapped potential in the market, Mopane Advisory Services said Econet Wireless registered a nine percent growth in its subscriber base in three months starting March 2009.
“Other mobile operators, Telecel and Net One, have also started releasing new lines into the market, though not as aggressively as Econet. Government-owned Tel One has introduced fixed mobile lines and this is a segment of the market that has huge growth prospects.
“With the advent of internet calling services through VoIP such as Skype that enable internet users to make international calls at cheaper rates; Zimbabwe’s mobile sector is set to lose potential revenue from its highly priced international calls,” said Mopane.
Zimbabwe’s macro-economic environment has shown remarkable signs of stability since the formation of an inclusive government in February. The operating environment has largely been liberalised and market forces are now the key determinants of prices.
The advisory firm said the possible introduction of 3G mobile services in Zimbabwe was set to increase the revenue base of mobile operators in the country.
Mopane said the growth prospects of the sector were being affected by power cuts but companies have begun investing in additional power back-up equipment.
“Businesses have also continued to invest in additional back-up power equipment to cushion themselves from power outages that tend to disrupt network performance and affect service quality,” said Mopane.
Strong barriers to entry owing to the huge capital investment needed to set up a network were also noted as one of the key factors favouring local companies to register significant growth.
Competition amongst the mobile network providers has seen new and innovative products being launched for the benefit of the communicating public.
Net One, the country’s second largest mobile operator recently unveiled a package dubbed Your Big 5 that allow subscribers to phone at a discount of between 10 and 15 percent while Econet continues to introduce low cost mobile hand sets. The Zimbabwe Telegraph

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