Information & Communication Technology Arena

Lagos. March 6, 2010. Globacom has emerged the number two operator by subscriber number and grossed over 3.7million lines more than rival Airtel Nigeria, in one of the major telecoms market upsets emerging out of the 2010 telephone subscriber information released weekend by the industry umpire.

The much-awaited annual market information,
which offers insight into the annual state of play in the telecoms market, market performance of operators using key indicator of subscriber numbers and provides a barometer to measure the state of health of the telecoms industry was obtained by Technology Times on the website of the Nigerian Communications Commission (NCC).

The official government figure showed Glo ending 2010 with 19,627,415 lines as against Airtel Nigeria’s 15,834,243 representing a difference of 3,793,172 lines between them. While both operators have been running neck-to-neck over the last few years, Glo’s triumph over Airtel firmly places the second national opeartor in number two place.

But no rival has been able to upset the clear market leadership of MTN Nigeria that ended 2010 with 38,683,520 lines out of the nation’s active phone lines that totalled 88,348,026 lines and recorded a year end growth rate of 6.37 over the preceding quarter, during the period.

MTN Nigeria continues to lead the telecoms market by subscriber number and has a big chasm of 19,056,105 lines separating it from Globacom, the number two player.

During its high profile entry into Nigeria last year, Bharti Airtel, the new owners of Airtel, have promised to upstage MTN Nigeria as the telecoms market leader in the country and also plans to commit a $600million war chest to upgrade the operator’s network, improve service quality and drive an aggressive entry into rural and underserved areas to achieve the Nigerian market conquest.

However, the state of market performance reveals that Airtel may have ignored an equally bullish competitor in Globacom which last year announced go live of its international undersea cable, Glo 1, which it reckons will offer adequate market edge to support the introduction of new data services that will lock in existing subscribers and win new ones as the telecoms market players look beyond the traditional revenue stream from voice for survival.

One of the key milestones of 2010 is that it was the year that Globacom secured its second place to outsrip Airtel to the number 2 spot in the country.

Another major market upset was recorded by Etisalat, the market’s last entrant that had 6,791,986 lines at year end but showed up from this seemingly disadvantaged position with an impressive growth rate of 25.37 per cent in the last quater of 2010.

Among the family of five GSM operators, who among them account for 91.9 per cent of Nigeria’s 88.3million active phone lines, Etisalat recorded the most bullish growth in the last quarter with 25.37 per cent followed only by Globacom with 11.48 per cent. On the other hand, MTN Nigeria recorded a growth rate of 5.89 per cent while Airtel’s growth appreciated by 1.81 per cent within the period.

MTN’s slow growth in the last quarter of 2010, recording 5.89 per cent over the preceding one may be interpreted to mean that the market leader may have chose to switch from guarding churn by securing its existing customers or an outright lack of agressiveness in attracting new customers.

But the latter position is mitigated by MTN Nigeria’s decision last year to aggressively drive a rural telephony strategy that may win it new connections in rural and underserved markets in Nigeria’s geographically dispersed terrain when it signed a $400million deal with Chinese equipment supplier, Huawei Technologies.

Under the pact, MTN, known to be a traditional prospect for the high networth creme of the market says it is reviweing its strategy alongside Huawei Technologies to cover no fewer than 500 villages by the end of 2011.
The MTN-Huawei deal is generally regarded to be a response to Airtel, known to be adept at creaming off gold from the bottom of the pyramid based on its experience from not only from experience in its home country, India but its pedigree.

Airtel is curently the world’s fifth largest telecoms operator with over 207.8 million subscribers across 19 countries at the end of 2010. It is also the largest mobile phone company in India counting over 152.5 million subscribers at the end of 2010.

Another key outcome of the 2010 telecoms market duel among operators is that the Nigerian telecoms industry remains a terrain controlled by the deep pocket GSM players who at year end control 91.9 per cent market share leaving just 6.91 per cent and 1.19 per cent to mobile CDMA and fixed/fixed wireless operators respectively.

That is not likely to change soon as the CDMA market groans from rising competition from GSM operators who are equally poised to step up the game in the new year.

MTN Nigeria, realising the seeming edge offered the SNO by its wholly-owned submarine cable of Glo 1, has teamed up with in-country competitor, Vodacom of South Africa, one of the key investors in WACS, a competing cable due to land in Nigeria by mid-year.

Within the CDMA market, the smaller mobile operator are led by Visafone which account for 2,558,867 active lines followed by Multilinks Telkom, owned by South Africa’s Tekom with 1,454,704 lines. Starcoms trails them with 1,149,380 active lines against Reltel’s 939,145 lines during the same period.

Meanwhile, within the sector, Multilinks Telkom, which has indicated its intention to exit the Nigeria CDMA market on account of losses recorded by the company accounted for the most bullish year end growth of 15.36 per cent followed by Starcomms with 9.82 per cent and Visafone with 1.52 per cent.

However in the fixed/fixed wireless market, Starcomms leads with 575,417 lines followed by Multilinks Telkom with 121,834 lines and Reltel with 104,367.

The sector which accounts for 16 operators accounting for 1,050,237 active lines recorded a year end growth rate of 9.17 per cent.

At the threshold of the 10th anniversary of commercial rollout of digital mobile networks running on the GSM standard, which comes up this August, operators are shifting from aggressive ramping up of subscribers to the rollout of new data services to quench the market’s thirst for Internet and a host of other services that guarantees they keep churn at bay.

In a related development, NCC reports that total active phone lines have grown to 89,840,343 by January, this year with the GSM sector accounting for 82,618,510 lines; mobile CDMA, 6,186,442 and Fixed Wired/Wireless, 1,035,391.
During the same period, total connected lines in the telecoms market peaked at 114,628,533 with mobile GSM, 96,547,864; mobile CDMA, 12,338,686 and Fixed Wired/Wireless, 2,741,983.

The nation’s overall installed telecoms network capacity at January, this year stands at 158,256,859 with mobile GSM sector providing 131,720,867 lines; mobile CDMA, 17,187,721 lines and Fixed Wired/Wireless, 9,348,271 lines.

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