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2. LTE – Is Africa Ready for It?
Harbir Singh Nat
International Finance Corporation, World Bank Group
November 12, 2013
3. 1. Overview of 4G LTE Deployment in Africa
• 4G LTE take up in Africa has been slow:
As of September 2013, 85% of the 806mn connections
in Africa were 2G, 15% were 3G and only 0.7% were
4G
There are 15 live networks on the continent and
approximately 25 planned networks or in deployment
• Reasons for slow adoption of 4G LTE:
In green – Live networks
Data source: GSMA Intelligence
MNOs are still focused on expanding and improving
voice networks
• Most MNOs are still primarily running 2G or 2.5G
networks
• 3G penetration is only at 11%
• Many of the MNOs are struggling to make money
hence not focused on 4G expansion
Income levels do not justify cost of 4G development
Operators (MNOs, broadband companies) may not
want to pay potentially high 4G fees so they continue
with 3G or WiMAX deployment
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4. 2. Current status and growth perspectives in Africa
• Connections: By 2017 2G connections will have a
negative growth rate, while 3G and 4G connections
will grow at quarterly rates of 7.6% and 21%
respectively.
• LTE connections are expected to increase
exponentially from 558,000 at the end of Q32013 to
14.5mn in the next 3 years. Despite the high
growth rate, LTE connections will represent only
1.3% of total connections, up from 0.7% at the end
of Q32013.
• Penetration: 2G penetration will decrease by
approximately 7% in the next three years to 54%
by 2017, while 3G penetration is expected to
increase from 11% to 34%. 4G penetration will
evolve from 0.05% to 1.2%.
Data source: GSMA Intelligence
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5. 3. LTE network delivery models
Providers
•A mix of broadband (BB) companies and MNOs
•Although MNOs are still focused on voice services, some are purchasing LTE
licenses
•Existing and new BB companies are leading the way in network roll-outs
Spectrum
•Primarily higher frequencies - FD LTE
•Expensive compared to TD LTE
•Lower frequencies for the most part are not readily available due to lack of
digital switchover
Networks
•Retail networks: Nigeria, Uganda, Tanzania, Angola, South Africa, Namibia,
Zimbabwe
•Wholesale networks: Rwanda, Kenya
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6. 4. Investors’ view: LTE projects attractiveness
Enough spectrum for the project
Availability of spectrum for competition
MNO interest in space
Credible management team
Stable regulatory environment
Sizeable corporates and (urban) population with sufficient disposable income
Conservative capital structure
Clear exit path for investors
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7. 4. LTE deployment in other Emerging Markets: LAC
• 3G and 4G networks are more developed, together accounting for 45% of all
connections (estimated to be over 1bn connections as of September 2013).
• 4G networks are more widespread, currently 7% of all connections, and are
expected to grow faster, at 9% per quarter, building up to 25% of all connections
by 2017.
• 4G penetration is approximately 8% and is projected to increase at a fast pace,
reaching 30% in the next three years. 3G penetration is also expected to expand
by 15% during the same period, as 2G penetration decreases to as low as 38%
(today at 60%).
• There are 20 live networks on the continent and approximately 37 planned
networks or in deployment.
• Providers: Primarily MNOs, but broadband companies as well
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