Mobile Money and Telcos | |
Mobile Money and Telcos | |
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Thursday,
March 26, 2020 / 9:36 AM / By FBNQuest Research / Header
Image Credit: Alternative Africa
The
latest data released by the NCC, the industry regulator, show that internet
subscriptions stood at 128.4 million in January, representing y/y growth of
13%. The figure implies density of 65% in a population estimated at 198
million, placing Nigeria well above the African average of around 16% as
indicated by McKinsey. In January there were c.2.6 million new internet
subscriptions. In addition to subscriptions on multiple SIM cards for the
purpose of separate data packages, SIM purchases for smart devices (such as
tablets) which require mobile data to be fully functional may have contributed
to the rise in internet subscriptions.
MTN Nigeria (MTNN) accounted for the largest share (43%) of total
subscriptions. In January, MTNN recorded a 2.6% m/m increase in data
subscriptions. There has been a steady increase in MTNN data subscriptions
since August 2019.
Based on MTNN's Q4 2019 results, on a full year basis, data revenue grew
by 43% y/y in 2019. As at Q4 2019, MTNN had increased its 4G population
coverage to c.43.8% from 35.0% in Q3 2019.
Amongst the mobile network operators, Airtel recorded the highest m/m
increase (2.8%) in internet subscription while 9mobile recorded a decline of
-0.3% m/m.
There have been network issues across mobile network operators as well
as other internet service providers due to damaged undersea cables (WACS and
SAT3/WASC cable systems) on the continent's western coast. We understand that
repairs are underway. However, rough conditions at sea and inclement weather
are slowing down the process.
Internet subscriptions (% chg; m/m) |
|
Sources:
Nigerian Communications Commission (NCC); FBNQuest Capital Research |
Broadband penetration currently stands at 38%. To improve internet
speed, deeper broadband penetration is required. Based on the new national
broadband plan 2020 -2025, the FGN expects broadband penetration to hit 70% by 2025.
This is an ambitious target, though achievable with sizeable investments into
the sector.
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