Market Trends of South Africa Telecom Industry
This section covers the major market trends shaping the South Africa Telecom Market according to our research experts:
Roll Out of 5G
- A 5G infrastructure and service rollout is now in South Africa. The government of South Africa said in May 2021 that it planned to roll out the 4G network to more rural and underserved regions and implement the 5G network there. It also proposed changes to the country's laws and regulations to facilitate digital transformation. The country is moving towards digital transformation in a real sense through the convergence technologies such as the Internet of Things (IoT), cloud, edge computing, and 5G networks altogether,
- 5G is essential for the major digital platform ecosystems that would drive South Africa's fourth industrial revolution. Mobile network carriers, including MTN, Vodacom, Rain, and Telkom, to satisfy South Africa's huge rise in traffic for internet services, have already installed 5G networks. The current allotted bandwidth is expected to expand by more than 300 MHz through the recent auction organized by ICASA, which would help with the early phases of 5G network implementation and South Africa's bandwidth shortage.
- In March of this year, the authorities in South Africa concluded an auction of spectrum in the 700MHz, 800MHz, 2.6GHz, and 3.5GHz frequency bands for 5G services, in which all operators actively participated. According to the auction's rules, operators must reach population coverage of up to 80% to 97% within five years. The operators in South Africa could use these spectrums to boost the capacity and speed of their 5G network and its coverage area.
- The licensing of new bands makes it easier to utilize networks throughout the fourth industrial revolution and South Africa's economic recovery, especially when 5G fulfills its goal to continue bringing about digital transformation in the industry. In South Africa, digital transformation has gained a significant pace. South Africa has recently made major efforts in this area. It has been actively trying to improve 5G legislation and regulations to assist the country remain prepared for the digital age. The distribution of the 5G spectrum is anticipated to speed up 5G development and produce social value, which would lead to a quick uptake of 5G in the market, which has much-untapped potential.
- According to a report published by ICASA, 99.9% of South Africa's population had access to the 3G mobile network as of last year. 53% of mobile devices had 4G/LTE in 2015, but 97.7% had the same last year. Alongside this trend, smartphone penetration increased quickly, doubling to 91.2% in the four years from 2016 to 2019. Last year, nearly 7.5% of South Africa had 5G coverage. In the future, the 5G penetration in the country is expected to upsurge manifolds.
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Wide Wireless Penetration
- Mobile phones rebounded strongly in the next year after witnessing a double-digit decrease in 2020 as the epidemic devastated the economy and global supply networks. This was caused by inevitable supply chain tensions relaxing coupled with the rising power of customers to switch to upgraded mobile phones. Beyond this year, the recovery will continue, and retail volume sales are anticipated to approach pre-pandemic levels. Also, smartphones continue to rule the market as they quickly replace feature phones.
- The mobile connection has the potential to accelerate the digital transformation of the country and propel socio-economic development. Mobile connection is expected to play a vital role in establishing the "new normal" as South Africa and the rest of the globe shift into a post-pandemic economic recovery phase. The chance to use digital technology and services to boost productivity and efficiency in service delivery, create economies that are more robust to future shocks, and guarantee more equitable socio-economic growth is one that the authorities perceive.
- Africa is indeed experiencing a mobile phone revolution. With more than 100 million subscribers, currently, South Africa is the largest mobile phone market in Africa, thanks to its expanding economy. Following South Africa are Nigeria, Egypt, and Morocco. In the following five years, mobile phone sales in South Africa are expected to grow more than double. The growth of local and regional economies and the expansion of service providers' networks in the area are anticipated to support the increase.
- According to GSMA Intelligence data, 108.6 million cellular mobile connections-or 179.8% of the country's population-were active in South Africa at the beginning of this year. According to GSMA Intelligence data, South Africa had 108.6 million mobile connections at the beginning of the current year or 179.8% of the country's total population. As per the report, there were 4.8 million (4.6%) more mobile connections between the last and current year. It had a 68.2% internet penetration rate and over 89 million smartphone users.
- According to ICASA research, the most popular choice for mobile voice services in South Africa is unquestionably prepaid subscriptions. They made up 84 percent of all cellular voice subscriptions for mobile devices as of the end of September last year.
