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MTN Group subscribers peak at 141.6m, gains 60% market share in Nigeria

Posted on 11:49 PM by Unknown

Let's go! We can't wait: CEO, MTN Nigeria, Ahmad Farroukh, whose company leads the Nigerian mobile telephony sector with over 60 per cent share of the market. Photo courtesy: Daylife
Lagos. March 9, 20100. South Africa’s MTN Group said today that its subscriber base grew to 141.6 million across its 21 operations in Africa and the Middle East with the growth driven largely by its local operation, MTN Nigeria that gained 60 per cent of telecoms market by end of December 2010.
MTN Group President and CEO, Phuthuma Nhleko, says the telecoms company sees the year end “satisfactory operational performance” as the outcome of economies across its operations coming out of the pervasive global financial crisis of 2008.

MTN Nigeria, the market leader in the country, increased its share in the MTN Group to 25 per cent by gaining over 60 per cent market share driven by efforts to keep customer migration at bay and segmented promotions, the Group said in a statement today.

Nhleko adds that “MTN Nigeria performed well for the period under review despite increased competition in the fourth quarter, increasing its market share to 52 per cent through the capture of more than 60 per cent of the subscribers added by the market in 2010.”
The MTN Group result trails last week’s announcement by the Nigerian Communications Commission, the Nigerian telecoms regulator, that saw MTN Nigeria retaining market leadership with over 38.6 million followed by closest rival, Globacom with 19.6 million at the end of 2010. Airtel follows with 15.8 million while Etisalat Nigeria and Visafone recorded 6.7 million and 2.5 million active lines during the period covered in the official market subscriber information.

Nhleko says the Nigerian performance “was as a result of attractive segmented promotions to customers and effective churn management. Improved customer service and product accessibility through enhanced distribution channels and customer call centres also contributed to the subscriber base increasing by 25% over the year to 38.7 million.”
MTN Groups adds that its local operation is backing the regulator led SIM registration underway in Nigeria and has so far registered some 34 per cent of its entire user base.

According to MTN, “registration of the existing subscriber base is progressing steadily with approximately 34 per cent of the total base registered at 31 January 2011. From 14 February 2011, all new SIM cards are being sold partially activated in line with regulatory requirements. This gives customers 30 days to register the SIM card during which time they can only receive calls.”
During 2010, site roll-out only gained momentum in the second half of the year as MTN added 1,504 2G and 480 3G BTSs, bringing the total BTS count to 9,110 at year end.



“Capital expenditure reduced to 14 per cent of revenue from 31 per cent the prior year. Despite the slower roll-out, the operation maintained network quality and capacity and this will remain a priority as competition intensifies. In addition to the increase in BTS coverage, 4,800 existing BTS sites were upgraded”, says MTN.
According to Nhleko, “Nigeria also continued to roll-out fibre across the country, completing a 696 km fibre ring between Yola, Bauchi and Gombe. In an effort to enhance data capabilities, a national fibre expansion project (phase 1) was initiated linking 71 high-capacity BTS sites on fibre and integrating 66 sites. Further roll-out of WiMax continued to gain momentum, increasing the roll-out to three additional states.”
In South Africa, MTN increased its market share to 36 per while subscribers increased by 17.3 per cent for the period to 18,8 million in what the telecoms operator attributes to the 18.6 per cent increase in the prepaid segment to 15.5 million users.

In Ghana, MTN sees the West African nation as one of its “most competitive markets” where market share decreased to 53 per cent from 55 per cent in 2009. MTN Ghana recorded a 9 per cent increase in subscribers to 8.7 million at December 2010, driven largely by the introduction of new price plans and the revision of MTN Zone to allow subscribers to view discounts in terms of monetary value rather than as discount percentages.
According to Nhlleko, “MTN Ghana’s performance was encouraging given aggressive competition through headline tariff reductions and the impact of SIM card registration. This regulatory requirement resulted in net disconnections in the second half of the year. As at 31 December 2010, 70 per cent of the base had been registered. The final deadline for registration is June 2011.”

MTN says 2010 was a year in which its 21 markets saw growth of a number of data and value-added services including the introduction of a “dedicated ‘Commercial and Innovation’ function which has developed a comprehensive data strategy for the Group’s operations. Partner relationships, products and process frameworks are now better established for roll-out across the Group.”
Additionally, MTN invested and upgraded its network and IT infrastructure to support converged and IP-based services including 3G and WiMax.
This also includes investment in undersea cables and fibre transmission both on a national and international level as well as launch of MobileMoney in three more markets bringing the total number of countries that have launched this service to 11 and the total number of MobileMoney subscribers to 4.3 million at the end of December 2010, the company adds.

Moving forward, the company hopes to adopt an infrastructure tower-sharing strategy to pursue more extensive sharing of passive infrastructure and fibre. MTN also plans a structural framework for key projects including cost-effective platforms for delivery of data and services and standardisation and optimisation of systems and processes.
The company says 2011 will see increased centralisation of procurement activities and rationalisation of suppliers, implementation of shared services and outsourcing across the group.

“The Ghanaian market presented an ideal opportunity to commence the Group’s medium-term objectives with respect to its towers. MTN and American Tower Corporation (“ATC”) announced that they have entered into a definitive agreement for the establishment of a joint venture in Ghana. This includes the sale of 1,876 of MTN Ghana’s towers for approximately USD428,3 million, of which ATC will pay USD218,5 million for its 51% stake. This is expected to be implemented during the first half of 2011″, according to Nhleko.

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