Thursday, June 25, 2015

Nigeria's Telecoms Economic Output Drops

IN WHAT seems to be a deviation from the norms, the contribution of the telecommunications sector to the total economic output of the country dropped by a margin in the opening quarter 2015.

  • ·         Global System for Mobile Communications, GSM, continues to dominate mobile subscription with 98.34 percent of the total
  • ·         The growth in subscribers was mainly driven by Globacom, which recorded an average rate of 1.45 percent

  •       MTN dominated the number of subscriptions, with 61,218,803 subscribers


In Naira terms, the telecommunications sector contributed N1, 344,489.25 million or 8.38 percent to the total economic output, which is a marginal decline from the 2014 average contribution of 8.46 percent.

According to latest report on the sector from the National Bureau of Statistics, NBS, made available to the ICT-BizAfrica, the opening quarter of 2015 recorded a real growth rate of 5.36 percent, a rise of 0.61 percent points from the 2014 average growth rate of 4.75 percent.

The report observed that it was the second time in the space of four years that the sector would be recording a negative performance noting that the only negative yearly growth rates were recorded in 2011, with the lowest rate reaching - 6.45 percent in the third quarter.

However, according to NBS, the following quarter saw the highest rate record of 8.67 percent, which has not been matched to date stating that the share of telecommunications in real GDP has fluctuated between a relatively narrow margin between 2010 and the first quarter of 2015, peaking at 9.32 percent in the first quarter of 2010, and reaching a low of 7.68 percent in the third quarter of 2012.

The NBS report further observed that the annual averages have shown steady marginal declines from 9.03 percent of real GDP in 2010 stating that it declined to 8.68 percent in 2011, with marginal declines of 0.04 percent points in 2012, 0.07 percent points in 2013 and 0.11 percent points in 2014.

The telecoms sector report for the first quarter from the NBS revealed Global System for Mobile Communications, GSM, continues to dominate mobile subscription with 98.34 percent of the total, followed by CDMA with 1.54 percent of the total, whist fixed wire and wireless make up 0.09 percent and 0.04 percent respectively.

According to NBS, a total of 143,057,324 subscribers were registered with GSM technology to the four networks of MTN, Etisalat, Globacom and Airtel as of April 2015 adding that MTN dominated the number of subscriptions, with 61,218,803 subscribers or 42.84 percent of the total.

The report said Globacom followed with 21.00 percent, whilst Airtel was third most dominant at 20.48 percent putting Etisalat in the fourth position with 15.69 percent stressing that since May of 2014, monthly growth in GSM subscribers has averaged 0.95 percent, with the greatest increase recorded in December of 2014 at 1.97 percent and the lowest in July of the same year at -0.43 percent.

However, NBS stated that the growth in subscribers was mainly driven by Globacom, which recorded an average rate of 1.45 percent over the period, followed by Etisalat with 1.37 percent and Airtel with 1.29 percent, whilst MTN recorded the lowest average monthly growth in subscribers at 0.44 percent.

Similarly, the greatest monthly growth rate of the four networks was recorded for Globacom in July of 2014, in which the number of subscribers increased by 1,637,543 or 6.37 percent while the lowest rate was recorded for Airtel with a figure of 436,260 or 1.72 percent fewer subscribers was recorded.

The internet subscription section of the report showed that only 60.75 percent of the active GSM lines had internet subscription with the majority of internet subscriptions being on the MTN network, with 39,520,285 or 45.48 percent of the total, followed by Globacom with 19,690,526 or 22.66 percent of the total.

Airtel ranked third with 17,272,665 subscribers or 19.88 percent of the total, whilst Etisalat had the lowest number, with 10,421,229 or 11.99 percent of the total.

However, the growth statistics in the internet sector revealed Globacom as the major driver with an average of 539,034 additional subscribers each month, a rate of 3.39 percent, although all the operators exhibited strong growth. Between April of 2014 and May of 2015, monthly growth in internet subscriptions averaged 2.36 percent.

Porting activities of the report stated that a total of 15, 519 active subscribers ported with different network in April of 2015, representing just 0.01 percent but of these Etisalat received the most, with 9,875 or 63.63 percent of the total, followed by Airtel with 2,993 or 18.90 percent and Globacom with 1,717 or 11.06 percent with MTN receiving the fewest subscribers at 994 or 6.41 percent.

On outgoing subscribers, the four network operators recorded a total of 15,357 active subscribers leaving their networks in April of 2015 while MTN recorded the most, with 8,161 or 53.14 percent of the total leaving the network for another.

Airtel followed, with 3,381 subscribers or 22.02 percent of the total transferring, whilst Globacom came third with 2,038 or 13.27 percent of the total. Etisalat had the fewest wishing to transfer, at 1,777 or 11.57 percent of the total.

According to NBS, over the period of May 2014 to April 2015, monthly growth in subscribers transferring away from their network averaged 2.96 percent saying that transfer was primarily driven by MTN, which recorded a monthly average of 8.71 percent for the same period while the only operator to record negative monthly growth over the period on average was Globacom, which had a rate of -1.75 percent.

For internet subscribers on the CDMA networks, two of them Multilinks and Visafone had a total of 150,799 internet subscriptions, which is just 6.75 percent of the total CDMA mobile subscribers.

The NBS report stated that Visafone holds the large mobile subscription majority of the internet subscriptions, with 150,252 or 99.65 percent of the total saying that the remaining 527 or 0.35 percent of internet subscribers are held by Multilinks.

However, monthly average growth in the number of internet subscribers remained low at 0.05 percent, driven by Visafone, which also had 0.05 percent average growth.

Multilinks on the other hand had high average monthly growth, of 15.69 percent, although absolute numbers remained low while Visafone experienced a month on month declines in internet subscriber numbers in four consecutive months in 2014, from July to September, reaching a trough of -2.39 percent that month, with 3,687 fewer subscribers that month. Growth picked up thereafter, with 2,063 or 1.35 percent more subscribers in April of 2015 from the preceding month.


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