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 Tuesday, December 08, 2009

­The mobile market in Mozambique is in its nascent stage with only two operators catering to the burgeoning demand for mobile services. Large investments are being made in infrastructure development, with the enterprises segment having the maximum growth potential due to the increased number of companies opening sites in the country, especially in remote areas.

The bid for a third operator is expected to be finalized by December 2009, further stimulating the competitive environment from 2010. Submarine cables are being deployed to provide global connectivity as well as improve local and international traffic. New analysis from Frost & Sullivan finds that market earned revenues of $300 million in 2008 and estimates this to increase six-fold by 2015 to reach $1.8 billion.

"Mozambique is a promising country in various sectors," says Frost & Sullivan Senior Analyst Silvia Hirano Venter. "The recent introduction of foreign companies and expatriates with high incomes is boosting the demand for more sophisticated communications services, driving the country to invest in the development of its infrastructure."

Substantial improvements in infrastructure and regulation are expected to take place by 2012 and Frost & Sullivan believes that the market is likely to reach its full potential by 2014.

"Currently, Mozambique has only two operators and five key vendors," Venter says. "There are several opportunities for companies interested in expanding to remote areas. Additionally, there is growth potential for companies that offer optimised solutions for infrastructure as a way to reduce the capital and operational expenses of operators."

However, several factors are hampering market growth, such as an inadequate transportation system, unreliable power supply, natural disasters such as floods and droughts, and the presence of landmines. Companies should effectively address these issues to succeed in this geographic area.

"The current global economic downturn has affected Mozambique indirectly, as the demand for agricultural products and commodities has reduced," explains Venter. "However, such challenges are projected to reduce in intensity over the next few years, even as demand is set to rise."

Only 16.0 percent of the population currently utilizes mobile services to communicate. The network quality is good and the much-anticipated roll out of the submarine fibre optic cables will represent an advance in data traffic and capacity.

"Companies should continue to invest in the extension of the network to rural areas to enable the reduction of prices," concludes Venter. "Despite the challenges, the future looks bright for Mozambique's mobile communications market."

Source: Cellular News