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    Home»News»Zimbabwe set for telecoms growth spurt

    Zimbabwe set for telecoms growth spurt

    News By Editor9 May 2011
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    Protea Hirschel

    The Zimbabwean telecommunications industry is set to enjoy another growth spurt following a trebling in growth between 2009 and mid-2010.

    This is according to consulting firm Frost & Sullivan, which says demand for voice and Internet access is still high in the beleaguered country.

    However, Frost & Sullivan analyst Protea Hirschel says increased political instability in the run-up to elections, expected anytime in the next two years, could have a negative effect on the market.

    Hirschel’s research shows that the Zimbabwean mobile communications sector generated revenues of US$372,2m in 2009. She estimates these will reach $1,34bn by 2016.

    “This represents a compound annual growth rate of 20,1%, considerably lower than the phenomenal 40,6% revenue growth experienced from 2008 to 2009,” she says.

    Hirschel says unfulfilled demand, initially for voice and increasingly for data services, is one of the main drivers of growth. Fixed lines are unlikely to meet this demand in Zimbabwe.

    Although the subscriber base is growing, average revenue per user is still not as high as it could be, she says.

    Zimbabwe’s unemployment rate, estimated to be as high as 80%, means voice telephony and Internet services are competing with basic necessities for spend, keeping revenues down.

    “The success of several promotions in the past 18 months has, however, shown the importance of affordable pricing in Zimbabwe,” she says. “Offering subscribers a compelling value proposition will continue to be of importance in this market.”

    According to the research, network quality of mobile networks in Zimbabwe is generally considered by subscribers to be poor. “Perceived low network quality has also resulted in a high incidence of multiple Sim cards as subscribers hedge their bets between networks,” says Hirschel.

    She says that after the dollarisation of the economy in 2009, mobile operators were unable to keep up with demand from consumers, contributing to poor network quality. “Capacity constraints have, to an extent, been overcome at present.”  — Staff reporter, TechCentral

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