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Connectivity index global and Africa Thecla Mbongue, Senior analyst, MEA Connect 2 Connect Pretoria, 19 th July 2016
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Connectivity index global and Africa
Thecla Mbongue, Senior analyst, MEA
Connect 2 Connect
Pretoria, 19th July 2016
Broadband connectivity index
Broadband connectivity enablers in Africa
The future of digital services in Africa
Key takeaway
Connectivity index global and Africa
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Ovum’s Broadband Development Index (BDI)provides a global picture of broadbandconnectivity and the rate at which differentcountries are migrating customers to high-speed networks.
The BDI has separate scores for fixed andmobile network connections. The maximumvalue of the mobile index is 500. Themaximum value of the fixed index is also 500.The maximum value of the total BroadbandDevelopment Index is therefore 1000.
Broadband connectivity index
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Africa is the second-lowest-ranked region in the world in terms of its overall broadband development, with a BDI score of 236 out of 1,000 for 2015
The world average was 385 in 2015
Broadband connectivity index
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Broadband connectivity index
Southern African and Northern Africanmarkets record the highest BDI. Marketswith highest BDI usually have a strongfixed network legacy and/or are oftenearly LTE adopters
Mauritius is the highest-ranked country inAfrica in the BDI for 2015, with a score of290 out of 1,000
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LTE, key connectivity enabler on a continent dominated by mobile networks
Broadband connectivity enablers
Timeline LTE launches in Africa
Angola, Mauritius, Namibia, Tanzania, South Africa,
Uganda
Nigeria, Zimbabwe, Zambia
Cote d’Ivoire, Ghana, Kenya, Lesotho, Gabon, Rwanda, Seychelles, Madagascar
Botswana, Chad, Ethiopia, Benin, Cameroon, Bissau
Burundi, Liberia
2012
2013
2014
2015
2016
Networks rollout (LTE, FTTx…)
Regulation (spectrum allocation)
Affordability (tariffs, smartphones)
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LTE, key broadband connectivity enabler on a continent dominated by mobile networks
Broadband connectivity enablers
Africa mobile subscription forecasts by technology, 2015–20 Africa fixed broadband subscription forecasts by technology, 2015–20
Mobile broadband subscriptions on the continent will reach 1 billion in 2020, up from 222.34 million at end-2015. The number of fixed broadband connections in Africa is expected to increase from 11.61 million at end-2015 to 17.23 million at end-2020. xDSL will account for the largest number of fixed broadband connections in Africa throughout the forecast period.
LTE a key player in a both fixed and mobile segments. In the fixed market, WiMAX subscribers are being migrated to LTE platforms.
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The future of digital services in Africa
-
500
1,000
1,500
2,000
2,500
3,000
Smartphone Non-Smartphone Tablet Other Portable
Cellular traffic in Africa (PB) ; 2015-2020
2015 2020
-
500
1,000
1,500
2,000
2,500
3,000
Smartphone Non-Smartphone Tablet Other Portable
Wi-Fi traffic in Africa (PB) ; 2015-2020
2015 2020
Improved broadband connectivity fuels data traffic growth as well as substantial opportunities in data-based or digital services
Africa data traffic over fixed broadband networks exceed 630 PB in 2015, set to reach 2,000PB in 2020
Africa data traffic over cellular + Wi-Fi networks exceed 1,200 PB in 2015, set to reach 8,000 PB in 2020
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The future of digital services in Africa
Venturing and incubation
Connectivity
B2C B2B
Music OTT video Games Carrier billing
Advertising
Big data
Payments (emerging markets)
M2M and IoT
Cloud computing Unif comms
Cloud / storage
Energy efficiency
VerticalsConnected Car
B2B
2C
:p
latfo
rm, e
nab
lem
en
t, wh
ole
sale
?
Bundled services
IoT
ICT services
Smart home
Health
Security
Entertainment
Managed services Security
Improved broadband connectivity fuels data traffic growth as well as substantial opportunities in data-based or digital services
Rising trends: global
B-brands(trending)
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The future of digital services in Africa
Connectivity
B2C B2B
Music OTT video Games Carrier billing
Advertising
Big data
Payments (emerging markets)
M2M and IoT
Cloud computing
Cloud / storage
Energy efficiency
VerticalsConnected Car
B2B
2C
:p
latfo
rm, e
nab
lem
en
t, wh
ole
sale
?
Bundled services
ICT services
Smart home
Entertainment
Managed services Security
Improved broadband connectivity fuels data traffic growth as well as substantial opportunities in data-based or digital services
Rising trends: Africa
B-brands(trending)
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The future of digital services in Africa
Mobile financial services: P2P to remain the key segment over the next 5 years
Globally , m-commerce is driving growth in the m-payments user base. The exception to this is Africa, where the user base for P2P transfers remains the largest of all m-payment segments throughout the forecast period.
The transaction value of P2P transfers will also remain larger than that of m-commerce in Africa until towards the end of the forecast period, when m-commerce will pull ahead.
International remittance is a key growing segment as operators increasingly partner with financial institutions and between each other for cross border and international remittance.
M-payment usage in Africa by segment; 2013-2019
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The M2M/ IoT opportunity
M2M connections will morethan double to reach 45.2million by 2020.
Utilities and transport are thebiggest vertical sectoropportunities, in number ofconnections. The utilities sectorwill reach 15.9 millionconnections (35% of allindustrial M2M connections) in2020 (prepaid electricity, smartmetering) . Transport will use8.3 million connections by2020.
The future of digital services in Africa
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Connectivity impact on digital services growth
OTT/VOD and TV: segments boosted by new platforms and increased availability of local content
DTT switchover has started across Africa with few markets planning to complete fully the process byend-2016. Despite a lot of announcements and a lot of enthusiasm from the authorities, Lack offunds to accelerate the process will most likely make it a lengthy venture.
Pay-TV operators still have a bright future at least for the short-term as DTT is yet to take off but alsobecause Pay-TV key players, with more funds, continue secure premium content and investincreasingly in VOD.
Market leader Canal + has invested a lot in local content during 2015. Such initiative helped Canal +adding 500,000 subscribers over the year to March 2016, when the group passed the 2 millionsubscribers mark in Africa. In 1Q16, Canal+ launched DTT services branded “Easy TV” in Congorepublic.
VOD is becoming a key element of TV operators’ strategies. In 4Q15, Orange group announced itsparticipation in funding SVOD platform Afristream currently available in Cote d’Ivoire and Senegal.In 1Q16, Netflix launched its platform across Africa and in May 2016, South African based ShowMaxexpanded from South Africa to other African markets (including Francophone markets).
Key Takeaways
Africa BDI to double over the next 5 years,
however, Africa will still rank among the lowest in terms of broadband
connectivity.
4G and fibre networks rollout are Key broadband
connectivity enablers.
Regulation stance still holds 4G deployment
in key markets. Spectrum auction
mostly delayed by the slow broadcast digital
migration process.
Improved broadband
connectivity fuels substantial opportunities in digital services
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