For the purposes of this article, West and Central Africa refers to Nigeria, Côte d'Ivoire and Cameroon. West and Central Africa is one of the richest regions in sub-Saharan Africa, with most of the countries being oil, mining and agricultural exporters.
• Nigeria, Côte d'Ivoire, and Cameroon are oil exporters and home to dozens of mining companies.
• Nigeria is the third largest African economy in terms of GDP after South Africa and Egypt.
The three countries had GDP per capita (PPP) of more than $1,500 in 2010, higher than the average of $1,000 in sub-Saharan Africa. Moreover, all three countries have outstanding literacy rates, more than 60 percent in 2010. This, coupled with high GDP per capita, is an indication that higher end-services, other than voice, can easily be adopted by the population. That said, these countries still face high levels of corruption and regulatory challenges that hamper market growth in terms of telecommunications services. Unlike Cameroon, Côte d'Ivoire and Nigeria are connected to three undersea cables: Main One, SAT-3 and Glo-1. These countries also expect the landings of other undersea cables such as the West Africa Cable System (WACS) and Africa Coast to Europe (ACE) in 2011 and 2012, respectively. The landings of these undersea cables have started to have a positive impact on the telecoms sector, with the reduction of wholesale bandwidth costs. This situation has led to the introduction of advanced applications such as unified communications and IPTV. Moreover, the landings of these cables have triggered the deployments of terrestrial fibre-optic backbones by mobile operators in Nigeria and Côte d'Ivoire. For example, MTN Nigeria and Globacom have rolled out nationwide fibre-optic cable backbone in Nigeria. In 2009, there were approximately 92.6 million mobile subscribers in the three countries, representing a mobile penetration rate of 40 percent. This indicates that there are still growth opportunities in the region, especially in rural areas. MTN and Globacom remain the largest mobile operators in the MTN - 44.4% Globacom - 18.9% OTHERS - 21.1% ZAIN - 15.6% Mobile Penetration Rate (%) 0.0 5,000.0 HIGH 0.5 LOW GDP Per Capita ($) Cote d'Ivoire Cameroon Nigeria three countries, with 44.4 percent and 18.9 percent market share, respectively. However, with the acquisition of Zain by Bharti Airtel, the competitive landscape is expected to change in Nigeria. Frost & Sullivan expects that Airtel is likely to increase its market share in Nigeria in the next five years, thanks to the implementation of its Indian model. This model of Airtel's has started to bear fruit in Kenya where the company has managed to chip away at its competitors' market share. Moreover, CDMA operators have been losing market share to GSM operators in Nigeria. This is mainly due to the lack of economies of scale. In response to this downward trend, CDMA operators should focus on mobile broadband services and complement their product offerings with GSM services. The mobile market generated US$8.6 billion and is expected to reach US$12.6 billion, growing at a CAGR of 5.6 percent from 2009 to 2016. The healthy growth rates can be attributed to an increase in mobile data and subscriber acquisition revenues as mobile operators initiate several new data tariff plans to boost their overall revenues.
Regulatory and infrastructure overview
The level of telecoms deregulation varies among the three countries, with Nigeria being the most liberalised. Other factors include:
• Nigeria has introduced a unified licensing regime.
• No monopoly on intercity fibre-optic deployments is present. • Nigeria is on the threshold of implementing mobile number portability.
• Unlike Cameroon, mobile operators are allowed to deploy intercity fibre-optic backbone in Côte d'Ivoire and Nigeria.
• In Cameroon, mobile operators are only allowed to roll out metro fibre-optic backbone. • Only the incumbent Cameroon Telecommunications (Camtel) is allowed to build nationwide fibre-optic backbone.
However, in Cameroon, the regulator has drafted a new ICT bill that will put an end to this situation. This bill is expected to come into force before the end of 2011. Only the Nigerian Communications Commission (NCC) has a clear policy on mobile number portability (MNP) in the region. The NCC is expected to implement MNP before the end of 2011. This implementation is likely to boost competition in Nigeria's telecoms sector and subsequently mobile operators are expected to provide enhanced services to their customers. Similar to other sub-Saharan African countries, there remain little or no competition laws and this lack of regulations has led to anti-competitive behaviour among the telecoms operators. Currently, competition-related issues are handled by telecoms regulators. There are interconnection regulations in these countries. NCC has recently introduced asymmetric interconnection rates, while regulators enforce symmetric interconnect rates in Cameroon and Côte d'Ivoire. Small market participants and new entrants are expected to benefit from this new interconnection regime in Nigeria. Mobile operators have deployed nationwide 2G/2.5G networks in these countries, whereas 3G/3.5G and WiMAx networks are still limited to major urban cities.
West and Central African market development and trends
To mitigate decline in revenues from voice revenues, mobile operators have started to provide mobile money services to consumers in Côte d'Ivoire and Cameroon. These offerings are expected to help mobile retain customers and sustain profit margins. This is likely to remain the trend in the next five years in these countries as Nigeria's Central Bank has issued licences for mobile money services to mobile operators. Another key trend is the moving of mobile operators in the broadband space in these countries. Unlike in other sub-Saharan African countries, mobile operators in these 3 countries have started to play aggressively in the broadband market. To this effect, these mobile operators have acquired ISPs and built data centres to cater to the lucrative corporate customers. Moreover, mobile operators have been outsourcing the management and maintenance of their networks to third parties. This is mainly observed in Côte d'Ivoire and Nigeria, where mobile incumbents closed outsourcing deals with vendors such as Nokia Siemens Networks and Helios Towers Africa Limited. Due to the lack of xDSL infrastructure and other alternatives, 3G and 3.5G networks are expected to become primary access technology for the Internet. Mobile operators are expected to deploy 3G and 3.5G networks in Cameroon and Côte d'Ivoire by 2012, due to high demand for mobile broadband services.