Boston, MA -- (SBWIRE) -- 06/10/2014 -- BMI View: The uptick in wireline network infrastructure investments in South Africa will boost competition in the sector and drive growth in the sector. We also believe that the rollout of new services is arguably the most important outcome of increasing competition in the wireline sector, beyond the expected improvement in the quality and pricing of basic voice and data services. The South African telecoms market is ripe for convergence services for both corporate and residential customers considering the level of economic activity in the country and relatively high income levels, especially in urban areas. Mobile operators MTN and Vodacom are leading this drive, which we believe will challenge Telkom's dominance of the wireline sector.

Key Data

- The mobile market grew by 2.9% q-o-q in Q413 to bring total growth in FY13 to 6.9%.
- Market average ARPU declined by 4.6% in FY13, despite an uptick in H213 on the back of strong data usage.
- The fixed-line incumbent operator, Telkom SA, reported a 4.6% y-o-y decline in fixed telephony subscriptions in the 12 months to September 2013, offsetting positive growth recorded by alternative operators.
- Total ADSL subscriptions grew by 6.7% in the year to September 30 2013.

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Risk/Reward Ratings

South Africa was pushed down to fifth position in this quarter's update to BMI's Risk/Reward Ratings for Sub-Saharan Africa following strong performances from Gabon and Ghana. South Africa's aggregate score also fell by 0.2pps to 52 owing to a sharp drop in its Industry Rewards rating to reflect slow subscriptions growth over our five-year forecast period to 2018. That said, South Africa remains one of the region's most developed markets and operators boast a healthier subscriber mix than much of the rest of the region, keeping its scores above the regional average. However, its more mature mobile market means that growth prospects are slower than many of its neighbours and we expect operators to diversify their revenue...

The South Africa Telecommunications Report features Business Monitor International (BMI)'s independent industry forecasts on the future strength of South Africa's ICT market, covering the fixed-line, mobile and internet segments and analyses latest regulatory developments and corporate news, including investment activity, mergers and acquisitions, joint ventures and partnerships. Leading operators and manufacturers are fully profiled, highlighting their quarterly financial performance, capital expenditure plans and latest contracts.

BMI's South Africa Telecommunications Report provides industry professionals and researchers, operators, equipment suppliers and vendors, corporate and financial services analysts and regulatory bodies with independent forecasts and competitive intelligence on the telecoms industry in South Africa.

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