Thursday, February 04, 2016 08:26 PM / NBS
Telecommunications in GDP and growth
In real terms, the telecommunications sector contributed N 1,385.85 billion to GDP in the third quarter, or 7.71%, a slight increase relative to the 7.57% contribution recorded in the third quarter of the previous year.
However it is lower than the contribution 9.57% recorded in the second quarter, but this is to a large extent due to different seasonal patterns of the telecommunications sector and whole economy. The annual growth rates recorded in the second and third quarters of 2015 were 4.66% and 4.69% respectively, lower than the 6.15% and 6.25% recorded in the same quarters of 2014.
The share of telecommunications in real GDP tends to fluctuate over the course of the year, due to different seasonal patterns, but nevertheless annual averages declined every year between 2010 and 2014. 2015 looks set to buck this trend, as telecommunications recorded stronger growth than the whole economy for each of the first three quarters.
Figure 1: Percentage Contribution of telecommunication to constant price GDP, and annual growth
Subscribers as of September 2015
The total number of subscribers has increased rapidly over the previous decade, and over the past year has increased steadily. Between September 2014 and September 2015 ( final month of Q3), the number had increased by 16.15 million, or 12.01%; higher than the annual growth rate between 2014 and 2013, but lower than in prior years, possibly as the market is already highly developed, which leaves less room for large expansion.
Most of the increase in the number of subscribers was attributable to additional Global System for Mobile Communications (GSM) subscriptions. The yearly increase between September 2015 and September 2014 was 12.52%, slightly higher than the growth in the overall number of subscriptions, but considerably higher than for other technology types (explored below).
Figure 2 gives a breakdown of subscriptions by type over the period, and reveals that GSM is the most popular subscription type, and that only a small fraction of subscriptions are for fixed lines (wireless or wired).
Subscribers by Technology Type
Subscriber data is broken into four sections according to the technology type used. The first two are for mobile technology; Global System for Mobile Communications (GSM) and Core Division Multiple Access (CDMA), whilst the latter two are fixed lines; either wireless or wired.
Mobile subscribers using GSM dominate, with 98.52% of the total, followed by CDMA with 1.36% of the total, whist fixed wired and wireless make up 0.08% and 0.04% respectively. The dominance of GSM users has increased since September 2014, when 98.07% of subscribers used this technology type; the share of all other technology types has decreased over this period.
The dominance of GSM over CDMA in the mobile technology is characteristic worldwide; GSM account for 82% of the global market according to some estimates. With GSM technology, it is cited as being easier to switch networks, and it is regarded as being more accessible for international use, especially given that some markets (such as in Europe) have mandated the technology by law. However, CDMA is more prevalent in the United States.
Mobile Subscribers (GSM)
In September 2015, at the end of the third quarter, there were a total of 148,427,423 GSM subscribers, divided across the four networks of Airtel, Etisalat, Globacom and MTN. This figure is slightly (0.19%) lower than in August when there were 148,703,160 subscribers, the first monthly decline since July 2014. MTN remains the largest provider of GSM subscriptions, accounting for 42.10%, despite a downwards trend in its share over the past year, from 44.24% in September 2014.
The second largest provider was Globacom, which accounted for 21.09% of subscriptions, similar to Airtel’s share of 20.98%. Etisalat accounts for the smallest number of subscriptions, at 15.83% of the total, although its share has increased slightly since its share in September 2014 of 15.07%. In spite of these trends the share of GSM subscribers accounted for by each network has changed only slightly over the year to September 2015
Overall growth in GSM subscriptions have grown at a monthly rate of 0.99% since September 2014, although August and September 2015 saw the lowest growth rates, of 0.14 and -0.19 respectively.
In these months, MTN also recorded its two lowest monthly growth rates since before June 2014, declining by 1.17% in August and 1.40% in September. These represent the largest declines for any provider since August 2014, and as MTN is still the largest provider, this had a large effect on the overall growth rate of subscribers. By contrast, Airtel recorded the highest growth rates in August and September, at 1.64% and 1.85% respectively.
These growth rates are reflective of the overall trends since September 2014. MTN subscriptions grew the least over this period, by 7.08%, equivalent to a monthly growth rate of 0.57%. Airtel subscriptions grew the most, by 19.50%, equivalent to a monthly growth rate of 1.50%, although this was similar to Etisalat, whose subscriptions grew by 18.16%.
Mobile Subscribers (CDMA)
In September 2015 there were 2,042,015 CDMA subscribers, 2,031,802 (99.50%) of which were provided by Visafone. The remaining 10,213 were provided by Multilinks. Over the past year Visafone has increased its dominance of this subscription type, as the number subscribing to Multilinks has declined in all but two months.
In September 2014 there were 21,405 Multilinks subscribers, more than double the present number. Visafone has also seen a decrease in the number of subscribers in the past year, however the growth in the number of subscribers has been more volatile over this period. On average, Visafone has seen a monthly decline of 0.45% in the number of subscriptions, which has been the main driver of the average monthly decline of 0.5% in the total number of CDMA subscribers. This equates to 15.14% decline during the previous year.
Fixed Wireless Line
Visafone also dominate the fixed wireless line market, albeit to a slightly lesser extent. Of the 66,319 wireless subscribers, 63,395, or 95.59% are accounted for by Visafone. This percentage has increased over the past year; in the previous September Visafone accounted for only 89.57%. As with CDMA subcribers, this can partly be attributed to a steady monthly decline in the number of Multilinks subscribers, from 6,855 in September 2014 to 2,923 in September 2015, a fall of 57.36%.
June was the only month in which Multilink fixed wireless line subscribers increased in number. By contrast, the number of Visafone subscribers increased from 58,891 in the previous September to 63,395 in September 2015, and increase of 7.65%. Most of this increase happened between June and September 2015, in which period subscriber numbers increased by 14.13%.