Revenues in the Angolan mobile communications market are set to triple by 2015 and while growth in Mozambique may be slightly lower, the high demand for services in both countries is creating lucrative investment opportunities, according to Frost & Sullivan.
“Mozambique and Angola are both emerging from long civil wars,” says Frost & Sullivan research analyst Silvia Hirano Venter. “Their governments have put together reconstruction plans to rebuild the basic infrastructure from roads and power supply to communications.”
The mobile communications markets in both countries are young with two operators in each catering to demand. A third operator was due to be licenced in Mozambique this year, but the awarding of the licence has been delayed amid complaints from the two existing mobile service providers, Mcel and Vodacom. As Mcel is a state owned company, political interests may also be influencing the speed of this process, Venter says.
Angola is expected to licence a third operator in 2010.
Many foreign companies have been attracted to these countries due to their available commodities and high GDP growth rates. They are creating a demand for a range of services, with communications being high on the list. As they are not just basing themselves in cities with established fixed-line infrastructure, there is a significant opportunity for mobile technologies.
“Foreign companies are importing staff from countries with developed technology, so they are likely to demand services like VoIP and value added services,” Venter says. “Operators are therefore investing in infrastructure development to support these services.”
There is also growing demand for communications from the local populations. There is particular interest in basic voice and SMS services as these are the cheapest and therefore attractive to the majority of potential customers. Angola, in particular, is also seeing demand for data services – especially mobile Internet for those seeking access from home.
“Operators in both countries will have to look at offering services that are in line with the needs of the population,” Venter says. “For instance, services customised to sugar farmers in Mozambique, such as commodity prices on demand, could be quite successful.”
However, as both countries are still in the early stages of development, significant investment is needed in basic infrastructure and to ensure connectivity is available countrywide. As electricity supply is neither widespread nor reliable, there is also a need to come up with alternative power supplies for mobile towers.
“Companies have to be aware that initial investment is going to be high here,” Venter adds. “However, those who are able to establish themselves in the market early can gain market share and experience. This will be invaluable in the long-term.”