African operators wins more mobile customers, earns less revenue

February 16, 2013

Africa’s mobile carriers have added nearly 10,000,000 new mobile customers and increased its post-paid accounts by three percent in the last quarter of last year, according to the latest quarterly report. The call revenue business remains the strongest part of the mobile network operators across the continent, with mobile revenues making up 65 percent of total revenues for mobile operators surveyed. The decrease in post-paid numbers was however offset by handset sales and significant rise in the number of customers buying mobile data.Mobile operators total revenues in East and Central African region experienced a slight decline, down three percent. The business and wholesale side of the mobile business also suffered a slight decline in revenue, down two percent. Mobile networks have now picked up products that have a strong appeal in the youth action-sports and entertainment markets.

Most business were also integrated into the companies corporate structure during the quarter. Network operators’ free cash at hand also decreased, down 30 percent and carriers have blamed the decline on higher capital expenditure and higher working capital due to handset receivables according to the survey.This capital expenditure has two prongs, with a long-term core network overhaul, and the ongoing roll-out of LTE in major urban areas in their respective countries like MTN Uganda is doing in Kampala and Entebbe, Vodacom Tanzania roll out tests in Dar Es Salaam and Arusha to mention but a few. The core network overhaul, largely overseen by Nokia-Siemens Networks and Huawei are on track, as most companies indicated. It is clear that most companies in African will continue to focus on delivering higher productivity through headcount reductions. Headcount dropped nearly ten percent year on year, with less employees during the last quarter of 2012.

Contador Harrison