Monday, 20 May 2013

Kenya,Angola:Cheapest telephony Markets in Africa



KENYA AND ANGOLA ARE the cheapest phone call markets in Africa. Their tariff per minute is $0.04. At the other end of the spectrum is Liberia the most expensive telecoms market, a report by Mobile Africa Tariff tracker says. 

Its mobile call rate per minute is US$1.71, says the report. Perhaps the most expensive in the world, we dare say. The country is served by four operators namely; lonestar, Atlantic, comium and cellcom.

 The report focusing on 37 African countries shows that six countries have tariffs ranging between $0.04 and $0.09. These include Kenya and Angola. Others in this category are; Ghana $0.06, Nigeria and Rwanda $0.08 and Gambia $0.09.

In the middle tier are 15 countries whose tariff per minute range between US$0.10 and $0.19. Tanzania and Uganda in east Africa are the cheapest in this category charging $0.10 per minute followed by Benin, Namibia, Burundi, Mozambique and at $0.14 per minute.

Congo, South Africa, Guinea, Bissau and Bourkina Faso charge at $0.16. The rest are in the expensive category of between $0.17 and $0.42 In Lesotho.

From the report it emerges that larger markets are relatively cheap but a lot depends on the local regulatory authorities to push the price down. In Kenya for instance, the regulatory authority CCK, pushed the price down to$0.04 per minute.  In Kenya, almost 30 million of the 42 million people subscribe to a mobile operator. The largest operator Safaricom, which boasts of some 20 million subscribers, is also the most profitable company in east Africa.
Mobile Telephony: Cheap in East Africa dear in West Africa

 Tiny countries with small populations are the most expensive markets. Information on the industry in Liberia is scant.  It is difficult to gather information such as subscriber base of each operator, not even at the Liberia Telecoms Authority, the industry regulator. A visit to their websites drew a blank on subscriber numbers. However, according to CIA Fact book 2013, there are an estimated 2.01 million subscribers in a country of 3.8 million people.

It is unclear how the subscriptions are distributed among the four operators. The scant information available shows that, Lonestar, which is owned 60 per cent by the Africa communications giant, MTN, had 1.05 million subscribers in March 2012. It is the largest network operator in Liberia.  The only other operator for whom subscription data was once available is cellcom boasting of 50,000 subscribers.

Liberia’s per capita income is estimated at US$700 has a population of nearly 4 million. Of these an estimate 2.01 million subscribe to a mobile line giving a penetration rate of more than 50 per 100 people.

According to the TCL report, the interconnection rate is $0.15 meaning that at $1.71 per minute, the operators are literally ripping off their customers. Liberia’s closest rival in the high cost of making a call is Lesotho whose tariff stands at $0.42 per minute. Others in the high cost club include Cape Verde$0.34; Gabon $0.32, Madagascar $0.30’ Thad $0.25.

 According to other sources, the cheapest markets are among the most profitable. Kenya’s Safaricom for instance has been consistently profitable since it was launched in 2001. Last year, the largest Mobile telephony operator in east Africa posted a profit before tax of US$303 million. After paying US$94 million in corporate taxes, the company’s net profits stood at $209 million of which $148 million was declared as dividends to shareholders.

Meanwhile the Safaricom CEO, Bob Collymore has said that nothing stops the firm from spreading into east Africa. Responding to our story last week, Mr. Collymore explained that the Kenyan market is yet to be satiated with its services. Consequently the company is for the foreseeable future focusing on the domestic market.

 He dispute analysts view that the market has matured saying that a majority of the customers hold Multiple Sim cards. He argued that, although 1.4 million subscribers were de-registered last year, it had no effect on revenue. A total of when 1.4 million of its subscribers were de-registered for non- compliance with government regulations.

 The company, he said, employs 3500 people directly and more than 250,000 indirectly selling such services as M-PESA, top up and Sim cards, and handsets.

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